United States District Court for the Middle District of North Carolina

UNITED STATES DISTRICT COURT FOR THE MIDDLE DISTRICT OF NORTH CAROLINA

In the Matter of: : : GEORGE HARTZMAN, : : Plaintiff, : Civil Action No. 14 CV 808 v. :

WELLS FARGO & COMPANY OR : ONE OR MORE OF ITS DIRECT : OR INDIRECT SUBSIDIARIES :

JOHN GERARD STUMPF

ROBERT KING STEEL

Defendants.

FIRST AMENDED COMPLAINT

Pursuant to Rule 15(a)(1)(b) of the Federal Rules of Civil Procedure, Plaintiff amends his original complaint to allege and say:

"TOO CONNECTED TO JAIL" - INTRODUCTION

Plaintiff, a former employee with fiduciary responsibilities to Defendant's clients managing accounts governed by The Investment Advisors Act of 1940, a former shareholder within a qualified retirement plan, a client in which Defendants were contractually obligated to act as Plaintiff's fiduciary and as a Whistleblower, contends;

1. Defendants with covert consent of at least the Board of Governors of the Federal Reserve (Federal Reserve or Fed), conspired against Plaintiff from 2008 through the present, harming Plaintiff's reputation, income and financial stability as an employee, a client, a shareholder in a ERISA governed retirement plan in which Defendants acted as fiduciaries, and as a fiduciary for Plaintiff's clients in which Defendants misled Plaintiff under the color of law concerning material information omitted in filings with the Securities and Exchange Commission (SEC) through the mail, but known to members of the Federal Reserve etc...

2. Messrs. Stumpf and Steel signed false Securities and Exchange Commission Sarbanes Oxley certifications in 2008 and 2009 filed through the mail, after both purchased Wells Fargo and Wachovia stock respectively, while in possession of material undisclosed and illegally reported financial information, with covert consent of at least the Fed and the Department of Justice, violating Plaintiff's constitutional right to due process.

3. Messrs. Stumpf and Steel conspired with at least the Fed, to mislead Plaintiff during and after the Wells Fargo, Wachovia merger through the mail. 1

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 1 of 144 4. In 2009, while in possession of TARP monies, Defendants conspired to commit fraud upon the US government via the 4front financial advisor retention bonus program via misleading Envision financial plans created and delivered through the mail without including charged investment costs in projected minimum client goals until TARP was paid off by Wells Fargo on December 23, 2009, which harmed Plaintiff.

5. As fiduciaries, Defendants with covert consent of at least the SEC and the Financial Industry Regulatory Authority (FINRA), conspired to commit fraud by mandating a fraudulent path for advisors to acquire retention bonuses via misleading Envision financial plans created without including charged investment costs in projected minimum client goals in 2009 and 2010.

6. Wells Fargo violated Plaintiff's confidentiality and anonymity after Plaintiff filed ethics complaints concerning violations of Sarbanes Oxley reporting requirements and insider trading by Wachovia and Wells Fargo executives in December, 2011 and 2012, placing Plaintiff and his family in physical danger and harming Plaintiff's reputation, income and financial stability as an employee, as executives across the financial industry and the United States government were also implicated by the same ethics line filings.

7. Wells Fargo violated Sarbanes Oxley accounting related whistleblower investigation procedures between December 2011 and October, 2012.

8. Wells Fargo, William Spivey and Aaron Landry, who terminated Plaintiff for whistleblowing, retaliated against Plaintiff's whistleblowing activities between December 2011 and October, 2012, along with Wells Fargo's in-house attorneys.

9. Between December, 2011 and October, 2012, Wells Fargo Attorneys conspired to harm Plaintiff as an employee, a client, a shareholder in a ERISA governed retirement plan, and as fiduciaries for Plaintiff's clients in which Defendants misled Plaintiff concerning material omitted information filed with the SEC through the mail.

10. As a fiduciary and in conspiracy with at least the SEC and FINRA, Wells Fargo is currently defrauding and recommitting fraud on what appears to be hundreds of thousands of clients, many with accounts governed by The Investment Advisors Act of 1940, via misleading Envision financial plans updated without including charged investment costs in projected minimum client goals and by not matching Envision financial plan asset allocation models to investment accounts, including plans created and/or supervised by William Spivey and Aaron Landry who terminated Plaintiff for whistleblowing, harming Plaintiff's reputation and income.

11. Wells Fargo continues to violate FINRA Rule 2210 involving Communications with the Public related to Envision plan advertising, continuing to harm Plaintiff's reputation.

12. Plaintiff's civil rights of due process were violated by at least the Fed, the SEC and FINRA in conspiracy with Defendants.

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 2 of 144 PARTIES

13. Plaintiff GEORGE HARTZMAN, currently President and Economist, Hartzman Fiduciary, formerly Think Professional Education and author of Questions for America, What to do Now; Think; Fiduciary Guide/Retirement Plans, for CPA, Attorney and investor financial ethics, philosophy and economic continuing education classes, was terminated by Wells Fargo on October 8, 2012 for whistleblowing activities protected by law.

Plaintiff has worked as a Financial Advisor since 1993, taught CPA and attorney financial ethics in North Carolina and was one of the only Advisors at Wells Fargo whose personal and client accounts performed well in the Financial Crisis of 2008 and early 2009.

14. Defendant WELLS FARGO & COMPANY OR ONE OR MORE OF ITS DIRECT OR INDIRECT SUBSIDIARIES "is an American multinational banking and financial services holding company which is headquartered in San Francisco, California, with "hubquarters" throughout the country. It is the fourth largest bank in the U.S. by assets and the largest bank by market capitalization. Wells Fargo is the second largest bank in deposits, home mortgage servicing, and debit cards. In 2011, Wells Fargo was the 23rd largest company in the United States.

...The firm's primary U.S. operating subsidiary is national bank Wells Fargo Bank, N.A., which designates its main office as Sioux Falls, South Dakota.

Wells Fargo in its present form is a result of a ... 2008 acquisition of Charlotte-based Wachovia...

Wells Fargo is one of the "Big Four banks" of the United States, along with JPMorgan Chase, Bank of America, and Citigroup... The company operates across 35 countries and has over 70 million customers globally. ...As of July 12, 2013, Wells Fargo became the world's biggest bank by market capitalization, worth $236 billion, beating ICBC.

On October 3, 2008, Wachovia agreed to be bought by Wells Fargo ...in an all-stock transaction. To further ensure shareholder approval, Wachovia issued Wells Fargo with preferred stock holding 39.9% of the voting power in the company.

...On October 28, 2008, Wells Fargo was the recipient of $25B of the Emergency Economic Stabilization Act Federal bail-out in the form of a preferred stock purchase. ...On Dec. 23, 2009, Wells Fargo redeemed the $25 billion of series D preferred stock issued to the U.S. Treasury under the Troubled Asset Relief Program’s Capital Purchase Program.

...Wells Fargo offers investment products through its subsidiaries, Wells Fargo Investments, LLC and Wells Fargo Advisors, LLC

Wells Fargo Securities ("WFS") is the investment banking division of Wells Fargo & Co.

In a March 2010 agreement with federal prosecutors, Wells Fargo acknowledged that between 2004 and 2007 Wachovia had failed to monitor and report suspected money laundering by narcotics traffickers, including the cash used to buy four planes that shipped a total of 22 tons of cocaine into Mexico.

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 3 of 144 In August 2010, Wells Fargo was fined by U.S. District Judge William Alsup for overdraft practices designed to "gouge" consumers and "profiteer" at their expense, and for misleading consumers about how the bank processed transactions and assessed overdraft fees.

On April 5, 2012, a federal judge ordered Wells Fargo to pay $3.1 million in punitive damages over a single loan, one of the largest fines for a bank ever for mortgaging service misconduct. Elizabeth Magner, a federal bankruptcy judge in the Eastern District of Louisiana, cited the bank's behavior as "highly reprehensible", stating that Wells Fargo has taken advantage of borrowers who rely on the bank's accurate calculations. She went on to add, "perhaps more disturbing is Wells Fargo's refusal to voluntarily correct its errors. It prefers to rely on the ignorance of borrowers or their inability to fund a challenge to its demands, rather than voluntarily relinquish gains obtained through improper accounting methods."

On July 13, 2012, Wells Fargo entered a settlement agreement with the U.S. Department of Justice for allegedly discriminating against African-American and Hispanic borrowers from 2004 to 2009.

On August 14, 2012, Wells Fargo agreed to pay around $6.5 million to settle SEC charges that in 2007 it sold risky mortgage-backed securities without fully realizing their dangers.

On October 9, 2012, the U.S. federal government sued the bank under the False Claims Act at the federal court in Manhattan, New York. The suit alleges that Wells Fargo defrauded the Federal Housing Administration (FHA) over the past ten years, underwriting over 100,000 FHA backed loans when over half did not qualify for the program.

In April 2013, Wells Fargo settled a suit with 24,000 Florida homeowners alongside insurer QBE, in which they were accused of inflating premiums on forced-place insurance. In May 2013, Wells Fargo paid $203 million to settle class-action litigation accusing the bank of imposing excessive overdraft fees on checking-account customers. Also in May, New York attorney-general, Eric Scheidermann, announced a lawsuit against Wells Fargo over alleged violations of the national mortgage settlement, a $25 billion deal struck between 49 state attorneys and the five-largest mortgage servicers in the US. Schneidermann claimed Wells Fargo had violated rules over giving fair and timely serving.

In December 2011, the non-partisan organization Public Campaign criticized Wells Fargo for spending $11 million on lobbying and not paying any taxes during 2008–10, instead getting $681 million in tax rebates, despite making a profit of $49 billion, laying off 6,385 workers since 2008, and increasing executive pay by 180% to $49.8 million in 2010 for its top five executives." http://en.wikipedia.org/wiki/Wells_Fargo . . Wells Fargo has a documented history of litigation delays;

"The SEC also alleged that Wells Fargo made unreasonable delay in producing related documents in course of the SEC’s investigation and provided “an altered” document related to a compliance review of the broker’s trading. 4

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 4 of 144 ...The company also violated laws that make necessary for broker-dealers and investment advisers to produce correct documents and records to the SEC in due time.

Notably, Wells Fargo has accepted its wrongdoing..." http://www.zacks.com/stock/news/148589/Bank-Stock-Roundup-Litigation-amp- Restructuring-Continue-Citi-BofA-Wells-Fargo-in-Focus . . "Wells Fargo caused what the plaintiffs termed a “seven-month delay” by seeking Fifth Circuit review after the trial certified two collective action classes ...The appeals court denied Wells Fargo's petition in March...

...The court initially approved a 90-day notice period, but before the notice form for potential plaintiffs could be approved, Wells Fargo lodged its Fifth Circuit petition, resulting in a stay. The detour to the Fifth Circuit “wasted valuable judicial resources”... http://www.law360.com/articles/442694/consultants-get-longer-notice-period-in-wellsfargo-ot-mdl . . "Wells repeatedly engaged in scorched earth tactics:

While every litigant has a right to pursue appeal, Wells Fargo’s style of litigation was particularly vexing. After agreeing at trial to the initial injunctive relief in order to escape a punitive damage award, Wells Fargo changed its position and appealed. This resulted in:

"A total of seven (7) days spent in the original trial, status conferences, and hearings before this Court; 2. Eighteen (18) post-trial, pre-remand motions or responsive pleadings filed by Wells Fargo, requiring nine (9) memoranda and nine (9) objections or responsive pleadings; 3. Eight (8) appeals or notices of appeal to the District Court by Wells Fargo, with fifteen (15) assignments of error and fifty-seven (57) sub-assignments of error, requiring 261 pages in briefing, and resulting in a delay of 493 days from the date the Amended Judgment was entered to the date the Fifth Circuit dismissed Wells Fargo’s appeal for lack of jurisdiction; 47 and 4. Twenty-two (22) issues raised by Wells Fargo for remand, requiring 161 pages of briefing from the parties in the District Court and 269 additional days since the Fifth Circuit dismissed Wells Fargo’s appeal."

The above was only the first round of litigation contained in this case…

The judge also describes Wells’ “reprehensible” conduct:

"...its own representatives have admitted that it routinely misapplied payments on loans and improperly charged fees, they have refused to correct past errors. They stubbornly insist on limiting any change in their conduct prospectively, even as they seek to collect on loans in other cases for amounts owed in error.

Wells Fargo’s conduct is clandestine. ...Wells Fargo admitted to the same practices for all other loans in bankruptcy or default. As a result, it is unlikely that most debtors will be able to discern problems with their accounts without extensive discovery…

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 5 of 144 ...The burden of extensive discovery and delay is particularly overwhelming. In this Court’s experience, it takes four (4) to six (6) months for Wells Fargo to produce a simple accounting of a loan’s history and over four (4) court hearings. Most debtors simply do not have the personal resources to demand the production of a simple accounting for their loans, much less verify its accuracy, through a litigation process.

...perhaps more disturbing is Wells Fargo’s refusal to voluntarily correct its errors. It prefers to rely on the ignorance of borrowers or their inability to fund a challenge to its demands, rather than voluntarily relinquish gains obtained through improper accounting methods. Wells Fargo’s conduct was a breach of its contractual obligations to its borrowers. More importantly, when exposed, it revealed its true corporate character by denying any obligation to correct its past transgressions and mounting a legal assault ensure it never had to.

Society requires that those in business conduct themselves with honestly and fair dealing. Thus, there is a strong societal interest in deterring such future conduct through the imposition of punitive relief…."

"The word “predatory” is not adequate to describe Wells’ conduct. The bank is not simply willing to steal from consumers, via blatant, institutionalized violations of its own agreements on mortgages and later on bankruptcy plans. It has absolutely no respect for the law, whether it be contracts or court procedures. It’s a band of marauders that our society treats as legitimate because the perpetrators wear suits and can afford to hire lobbyists. And the Federal government and state attorneys general are certain to have emboldened Wells and its brethren by rewarding them rather than treating them like the criminals they are." http://www.nakedcapitalism.com/2012/04/judge-rules-wells-fargo-engages-in-reprehensible- systemic-accounting-abuses-on-mortgages-hit-with-3-1-million-punitive-damages-for-one- loan.html . . "... The prejudice to Gutierrez and the class stemming from Wells Fargo’s invocation of arbitration five years into this litigation—time, expense, delay and uncertainty—is apparent. See Nat’l Found. for Cancer Research v. A.G. Edwards & Sons, Inc., 821 F.2d 772, 776 (D.C. Cir. 1987) (“To give [defendant] a second bite at the very questions presented to the court for disposition squarely confronts the policy that arbitration may not be used as a strategy to manipulate the legal process.”)... http://www.consumerfinancelitigation.com/uploads/file/Gutierrez%20v_%20Wells%20Farg o.pdf . . "The declarations submitted with this application, describing the experiences of 97 New York homeowners, show that Wells Fargo has not abided by its agreement. The Bank has engaged in widespread breaches of its most basic obligations under the consent judgment that have harmed and continue to harm thousands of New York families. Indeed, within the last few months, the Monitor of the consent judgment announced that Wells Fargo had repeatedly failed to comply with a key timing provision of the 2012 settlement.

The Bank has continued to subject homeowners to Kafkaesque delays and obstructions... 6

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 6 of 144

The Bank has also subjected homeowners to repetitive and wasteful court appearances and provided them contradictory and inaccurate information. ...The end result of this pattern of misconduct was the unlawful delay, or denial, of homeowners’ requests to modify their mortgage loans – and potentially save their homes.

...Wells Fargo made repeated additional requests for application-related materials, oftentimes because the documents that Mr. Baig submitted previously had “expired” as a result of the Bank’s delay. See Mirza Baig Decl. ¶ 12.

Finally, at a May 17, 2013 settlement conference, the court overseeing Mr. Baig’s case required the Bank to make a decision on the application by June 7, 2013. See id. ¶ 14. The Bank ignored this deadline and instead requested additional materials from Mr. Baig on June 20, 2013, two weeks after the court-ordered deadline to render a decision on the application. See id.

...Wells Fargo benefits from its own delays, as interest and fees that may be recovered upon foreclosure continue to be assessed on borrowers who are struggling to modify their mortgage loans..." http://www.ag.ny.gov/pdfs/NMS%20MOL.pdf . . On January 15, 2014, Plaintiff sent the first request for discovery upon Defendant within Department Of Labor (DOL) Case No. 2013-SOX-00045. After objections, delays and eventual intervention by ALJ Judge Krantz, Plaintiff sent Defendant requests for discovery on February 27, 2014. On March 28, 2014, Defendant delivered a reply without the content of the requested discovery. On April 8, 2014, Defendant informed Plaintiff a CD containing discovery material would be delivered the next day via Federal Express, which never came and was not signed for by anyone. On April 17, 2014, Defendant sent a defective unencrypted CD that wouldn't open, which Plaintiff sent Defendant a picture of, as only about a half inch of information was burned on the disk. On June 5, 2014, Plaintiff received discovery initially requested on February 27, more than three months later, and almost six months after Plaintiff's first request.

On January 28, 2014, Defendant argued for motions to be conducted by mail only instead of email, and sought an additional five days added to the prescribed thirty day period for each party to respond if electronic means was authorized to further delay the proceedings at the expense of Plaintiff.

After filing an initial Federal District Court Complaint on September 22, 2014, Plaintiff issued and received documented confirmation of delivery to Wells Fargo on September 26, 2014, which Defendant states there was no record of. After email exchanges with Defendant's council as filed on 10/14/2014, Wells Fargo received a second summons on 10/9/2014. Wells Fargo's council received a copy of the Complaint via certified mail before the end of September, 2014, yet Defendant's council said they "cannot locate any record of receiving this Summons."

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 7 of 144 15. Defendant "JOHN GERARD STUMPF (born September 15, 1953) is the current chairman and chief executive officer of Wells Fargo. He became chairman in January 2010. He was named CEO in June 2007, elected to Wells Fargo’s Board of Directors in June 2006, and has been President since August 2005.

Stumpf serves on the Board of Directors for The Clearing House, the Financial Services Roundtable, Target Corporation, and Chevron Corporation.

In 2012, Stumpf's total compensation was $22.87 million with a base salary of $2.8 million, $3,300,000 in cash bonuses, $12.5 million in stock granted, and $15,000 in other compensation." http://en.wikipedia.org/wiki/John_Stumpf

16. Defendant ROBERT KING STEEL; "Robert King "Bob" Steel (born August 3, 1951) is an American businessman, financier and government official who has served as Deputy Mayor for Economic Development in the administration of New York City Mayor Michael Bloomberg, Under Secretary for Domestic Finance of the United States Treasury, chief executive officer of Wachovia Corporation and vice chairman of Goldman Sachs [1976–2004].

In 1994, he relocated to New York and served as co-head of the Goldman Sachs Equities Division from 1996 to 2002 until his appointment as a vice chair of the firm. Upon his retirement from Goldman Sachs on February 1, 2004, he became advisory director and then senior director in December 2004.

Steel was appointed Under Secretary for Domestic Finance at the United States Department of the Treasury on October 10, 2006 and served until July 9, 2008. He was the principal adviser to the secretary on matters of domestic finance and led the department's activities regarding the U.S. financial system, fiscal policy and operations, governmental assets and liabilities, and related economic matters.

As economic conditions worsened in 2007 and 2008, Steel helped design the federal government's response.

On July 9, 2008, Steel was named president and CEO of Wachovia.

Steel was adamant that Wachovia would stay independent. However, by September 2008, market conditions had deteriorated severely. On September 26, Wachovia lost almost one percent of its deposits, leading regulators to force Wachovia to put itself up for sale...

In January 2009, The Wall Street Journal reported that the Securities and Exchange Commission was investigating claims Steel made about the future of the bank before it started talks about a potential merger.

Following the merger, Steel was invited to join the board of Wells Fargo and served on the firm's credit and finance committees. In 2010, upon being appointed Deputy Mayor for Economic Development of New York City, Steel resigned his seat on the Wells Fargo board.

On June 22, 2010, Steel was appointed by New York City Mayor Michael Bloomberg to serve as Deputy Mayor for Economic Development.

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 8 of 144 "In May 2014, [Steel] was tapped to succeed Joseph R. Perella as chief executive officer of Perella Weinberg Partners, a private investment banking and asset management firm." http://en.wikipedia.org/wiki/Robert_K._Steel . . ...Steel, 62, who had previously worked with Peter Weinberg at Goldman Sachs Group Inc., considered joining Perella Weinberg when the firm opened its doors in 2006, he said. http://www.bloomberg.com/news/2014-05-28/perella-weinberg-names-ex-treasury-official- robert-steel-ceo.html . . Perella Wienberg Parnters' ROBERT K. STEEL biography states "As CEO of Wachovia Corporation in 2008, Mr. Steel oversaw the sale of the bank to Wells Fargo & Co. and served on the Wells Fargo board of directors until 2010. During his tenure at the U.S. Treasury, he revived the President's Working Group, the core group to respond to the global economic crisis of 2008.

Mr. Steel also spent nearly 30 years at Goldman Sachs, rising to Head of the Global Equities Division, Vice Chairman of the firm and a member of its Management Committee.

...Mr. Steel also was a member of the board of directors of Barclays from 2005 to 2006." http://www.pwpartners.com/our-team/partners/biography?id=2475 . . After paying Peter Weinberg's Perella Weinberg Partners $25 million and Weinberg and Steels' former employer Goldman Sachs $25 million to advise Wachovia on the merger with Wells Fargo, Steel became CEO of Perella Weinberg Partners in 2014, after which Plaintiff asserts Steel earned some of the money he allocated to Perella Weinberg Partners as Wachovia's CEO. . . Bold and Underline = Hartzman emphasis

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 9 of 144 FACTS

17. According to Bloomberg News and the Federal Reserve, On January 17, 2008, unknown to shareholders but known to Wells Fargo CEO John Stumpf and most likely Chairman Richard Kovacevich, Wells Fargo borrowed $1.666 billion from the Federal Reserve Bank's Term Auction Faciltiy at 3.95% interest, with $47.930 billion in Unencumbered Collateral, found by Plaintiff in 2014, representing a massive, material undisclosed credit line with the Federal Reserve, details of which were not disclosed by Wells Fargo's 2008 and 2009 SEC reports filed through the mail. Unencumbered Assets, representing assets free and clear of any encumbrances such as creditor claims or liens, showed that Wells Fargo had available unreported Federal Reserve credit lines worth tens of billions very few knew of. http://www.federalreserve.gov/newsevents/reform_taf.htm http://www.bloomberg.com/news/2011-12-23/fed-s-once-secret-data-compiled-by- bloomberg-released-to-public.html

18. "The Working Group on Financial Markets (also, President's Working Group on Financial Markets, the Working Group, and colloquially the Plunge Protection Team) was created by Executive Order 12631, signed on March 18, 1988 by United States President Ronald Reagan.

The Working Group consists of:

The Secretary of the Treasury, or his/her designee (as Chairperson of the Working Group);

The Chairperson of the Board of Governors of the Federal Reserve System, or his/her designee;

The Chairperson of the Securities and Exchange Commission, or his/her designee; and

The Chairperson of the Commodity Futures Trading Commission, or his/her designee. http://en.wikipedia.org/wiki/Working_Group_on_Financial_Markets

19. ROBERT K. STEEL "revived the President's Working Group" under former Goldman Sachs colleague and Secretary of the Treasury Henry M. Paulson, "Chairperson of the Working Group", "or his/her designee".

"The Chairperson of the Board of Governors of the Federal Reserve System, or his/her designee" during ROBERT K. STEEL's revival of the President's Working Group at Treasury was Ben Bernanke.

"The Chairperson of the Securities and Exchange Commission, or his/her designee" during ROBERT K. STEEL's revival of the President's Working Group at Treasury was Charles Christopher Cox.

"The Chairperson of the Securities and Exchange Commission, or his/her designee" during ROBERT K. STEEL's revival of the President's Working Group at Treasury was Walter L. Lukken.

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 10 of 144 20. In March 2008, the Treasury released "THE DEPARTMENT OF THE TREASURY BLUEPRINT FOR A MODERNIZED FINANCIAL REGULATORY STRUCTURE", listing "Henry M. Paulson, Jr., Secretary" and "Robert K. Steel, Under Secretary for Domestic Finance" on page 3.

On page 83, a section entitled "Liquidity Provisioning by the Federal Reserve" stated "the Federal Reserve should consider the current process in terms of ensuring that the process is calibrated and transparent, appropriate conditions are attached to lending, and information flows are adequate.

Second, the President’s Working Group on Financial Markets should consider broader issues associated with providing discount window access to non-depository institutions."

And "The disruptions in credit markets in 2007 and 2008 have caused the Federal Reserve to address some of the fundamental issues associated with the discount window and the overall provision of liquidity to the financial system. The Federal Reserve has considered alternative ways to provide liquidity to the financial system. In addition to the Term Auction Facility (“TAF”) program for depository institutions, the Federal Reserve has had to think more broadly about overall liquidity issues associated with non- depository institutions...

Page 154 stated "Much of banks’ reluctance to use the discount window has often been attributed to a “stigma” that discount window borrowing appears to be a signal of fundamental weakness or could lead to additional Federal Reserve regulatory scrutiny. To address those issues, in December 2007 the Federal Reserve established a temporary Term Auction Facility (“TAF”) program. Under the TAF program, the Federal Reserve can auction term funds to depository institutions against the wide variety of collateral used to secure loans at the discount window. All depository institutions judged to be in generally sound financial condition and eligible to borrow under the primary credit discount window program are eligible to participate in TAF auctions. By allowing the Federal Reserve to inject term funds through a broader range of counterparties and against a broader range of collateral than open market operations, this facility helped to promote the efficient dissemination of liquidity.

Page 155 stated "The TAF auction process seems to have been successful in encouraging greater use of the discount window. The first TAF auction of $20 billion on December 17, 2007 attracted ninety-three bids worth $61.6 billion. The most recent TAF auction of $50 billion on March 24, 2008 generated eighty-eight bids worth $88.9 billion."

And "The concept of market stability discount window lending is broadly embedded in the framework of the Federal Reserve’s TAF auctions."

Page 156 stated "market stability discount window lending should be focused on overall market stability issues that cut across a range of institutions." http://www.treasury.gov/press-center/press-releases/Documents/Blueprint.pdf

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 11 of 144 21. On 4/3/2008, "Under Secretary for Domestic Finance Robert K. Steel Testimony Before the Senate Committee on Banking, Housing and Urban Affairs" stated "I very much appreciate the opportunity to appear before you today to represent Secretary Paulson and the U.S. Treasury Department, and to join the independent regulators leading the Board of Governors of the Federal Reserve System, the Securities and Exchange Commission, and the Federal Reserve Bank of New York."

...You have invited Treasury here today to discuss the ongoing challenges in our credit markets ...The Treasury Department continues to closely monitor the global capital markets, and the past several months have presented to us many important issues and situations to evaluate and address.

...Mr. Chairman, as you appropriately noted in your letter to Secretary Paulson, "it is important to maintain liquidity, stability, and investor confidence in the markets."

...For several months, our financial markets have gone through periods of turbulence, followed by periods of improvement. A great deal of de-leveraging is occurring, which has created liquidity challenges for financial institutions and thereby compromised our credit markets' ability to help be an engine of economic growth.

It took a long time to build up the excesses in our markets, and we are now working through the consequences. Market participants are adjusting, making disclosures, raising capital, and re-pricing assets.

We have continued to engage with our fellow regulators and market participants, so that collectively, we work through these challenges to limit the spillover effects to our economy and make our markets even stronger.

During times of market stress, certain issues may hold the potential to spill over to the broader markets and cause harm to the American economy. This was the case with the events surrounding the funding capability of Bear Stearns between March 13, 2008 and March 24, 2008.

...During this period, regulators were continuously communicating with one another, working collaboratively, and keeping each other apprised of the changing circumstances.

...We weighed the multiple risks, such as the potential disruption to counterparties, other financial institutions, the markets, and the market infrastructure.

...Our role at the Treasury Department was to support the independent regulators and their efforts with private parties as credit markets were operating under considerable stress, and we believed that certain prudent actions would help to mitigate systemic risk, enhance liquidity, facilitate more orderly markets, and minimize risks to the taxpayers.

...The Treasury Department supports the actions taken by the Federal Reserve Bank of New York and the Federal Reserve.

...Upon assessing the Bear Stearns' situation, the Federal Reserve decided to take the very important and consequential action of authorizing the Federal Reserve Bank of New York to institute a temporary program for providing liquidity to primary dealers. Recent market 12

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 12 of 144 turmoil has required the Federal Reserve to adjust some of the mechanisms by which it provides liquidity to the financial system.

...The Treasury Department and our colleagues comprising the President's Working Group on Financial Markets are addressing the current and strategic challenges, and are doing all we can to ensure high quality, competitive, and orderly capital markets. We seek to strengthen market discipline, mitigate systemic risk, enhance investor confidence and market stability, as well as facilitate stable economic growth." http://www.treasury.gov/press-center/press-releases/Pages/hp904.aspx

22. On 4/28/2008, Under Secretary for Domestic Finance Robert K. Steel Remarks before the Society of American Business Editors and Writers Annual Conference stated "When Secretary Paulson and I arrived at Treasury in 2006, he had a full agenda of global priorities. But on two of his strategic goals – financial preparedness and capital markets competiveness - Domestic Finance has provided leadership.

One of our earliest initiatives was developing protocols for financial preparedness within the President's Working Group on Financial Markets (PWG) – the group chaired by the Secretary of the Treasury that also includes the chairmen of the Federal Reserve Board, the Securities and Exchange Commission and the Commodity Futures Trading Commission. Having spent three decades in financial markets, Secretary Paulson and I understood that periodic market disruptions, many with the potential to impact the real economy, are a reality. While these events are difficult to predict or prevent, we wanted to prepare so as to be ready to take action.

...we undertook a series of initiatives to ensure that our markets remain the world's leader.

...During the three decades we worked in the financial services industry, we lived through many periods of market disruption, including the savings and loan crisis, the Asian financial turmoil, the collapse of Long Term Capital Management, and the dot.com bubble.

...any government intervention should be considered carefully so as to minimize moral hazard and any undue burdens that would damage the efficiency, effectiveness and competitiveness of our markets.

...The goal of public policy should be a marketplace that protects and gives confidence to investors and also provides a fair playing field for businesses. Government must ensure safe, stable and efficient functioning markets, while also being prepared to promptly respond to disruptions when they arise and minimize any contagion effect.

...With this in mind, in the fall of 2006 Secretary Paulson directed the President's Working Group on Financial Markets (PWG) to focus on financial preparedness.

In the last 20 months, the PWG has significantly enhanced its own protocols and procedures to improve communication and facilitate effective coordination and manage actions and responses in the event of a financial market challenge. These protocols include the ability for PWG member agencies to bring into the discussions a broader array of U.S. financial regulators, and given the global and borderless nature of financial markets, international supervisors depending on the situation. 13

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 13 of 144 ...The PWG works in cooperation with two other established groups to coordinate preparedness efforts: the public-sector Financial and Banking Information Infrastructure Committee (FBIIC); and the private-sector Financial Services Sector Coordinating Council (FSSCC). The FBIIC, chaired by the U.S. Department of the Treasury, is comprised of Federal and State financial regulatory agencies, and has coordinated and improved the resilience and security of the financial infrastructure. The FSSCC is comprised of U.S. exchanges, clearinghouses, financial institutions, financial sector trade associations, and regional coalitions, and has coordinated and improved critical infrastructure protection in the financial services sector.

...This overall commitment to financial preparedness by the PWG proved invaluable when challenges subsequently developed in the summer of 2007.

...The Administration and the independent regulators have responded vigorously to manage and minimize the impact of current challenges on the broader economy. Our goal has been to ease the housing correction, provide an economic stimulus and strengthen market discipline.

...On March 13, the members of the President's Working Group issued a comprehensive review of policy issues related to recent financial market turmoil. The PWG recommended measures to reform mortgage origination, strengthen risk management, enhance disclosure and improve market discipline in the securitization process, and reform disclosure and use of credit ratings.

As implemented, these recommendations will change behavior and strengthen our markets through greater risk awareness, enhanced risk management, strong capital positions, prudent regulatory policies, and greater transparency. The PWG has committed to measuring progress by the end of this year, so as to ensure the implementation of these recommendations." http://www.treasury.gov/press-center/press-releases/Pages/hp948.aspx

23. On 6/23/2008, Under Secretary Robert K. Steel Keynote Address to the Managed Funds Association stated "When Secretary Paulson and I arrived at Treasury in 2006, hedge funds were an increasing area of focus for public policymakers around the world...

It was the strong view of the President's Working Group that two issues, systemic risk and investor protection, are the key areas where policymakers should and must focus their attention with regard to hedge funds. The principles and guidelines highlight how these risks are best addressed through market discipline, disclosure and transparency and a balanced regulatory approach.

...At Treasury, we have been very clear that we believe hedge funds have many benefits for global capital markets. While being an advocate for the benefits of your industry, it is also important for me to be straightforward about the risks hedge funds pose and the responsibilities you must accept. In essence, congratulations are clearly in order to you and your industry, but with the benefits of that success comes additional responsibilities.

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 14 of 144 ...best practices emphasize ...Strong disclosure practices that provide investors what they need in order to make informed decisions...

Attempting to `beat the market' through fraud, manipulation or rumor mongering is an unacceptable breach of market integrity. That's not beating the market, that's cheating the market.

It is important that regulators have broad authority to investigate and prosecute those who seek to gain an unfair advantage. These measures instill confidence in market participants that the market is operating in a fair and transparent fashion where rules matter. Market participants must know the playing field is level and the rules are fair.

...I am confident that in the long term, our markets, financial institutions and regulatory practices will all help to make our capital markets stronger, enabling them to contribute to sustainable economic growth." http://www.treasury.gov/press-center/press-releases/Pages/hp1050.aspx

24. On March 27, 2008, Wachovia borrowed $3.5 billion from the Federal Reserve’s Term Auction Facility (TAF). which was not disclosed to the firm’s shareholders and not reported in the company’s legally required SEC securities filings. Unencumbered Assets, representing assets free and clear of any encumbrances such as creditor claims or liens, showed that Wachovia had available unreported Federal Reserve credit lines worth tens of billions very few knew of, which appears to have included Robert Steel. Federal Reserve Unencumbered Assets for Wachovia were $53.652 Billion, as discovered by Plaintiff in 2014 posted on the Federal Reserve's website as of August 2, 2013 as confirmed by Federal Reserve Public Affairs officer Cecelia Bradshaw on November 20, 2014. The $3.5 billion borrowed by Wachovia on 3/27/2008 represented a material 6.52% of the companies market capitalization, according to Bloomberg News.

25. On May 15, 2008, after twice borrowing during 2008 from the Term Auction Facility, and with more than $45 billion pledged as Unencumbered Collateral, Wells Fargo CEO John Stumpf purchased 1,550 of Wells Fargo stock valued at $44,841, and to Plaintiff's knowledge, was not reffered to the SEC or indicted by the Department of Justice for Insider Trading and Securities Fraud.

26. On May 22, 2008, unknown to shareholders but known to Wells Fargo CEO John Stumpf, Wells Fargo borrowed $7.5 billion from the Federal Reserve Bank's Term Auction Faciltiy at 2.1% interest, with $47.197 billion in Unencumbered Collateral representing an undisclosed credit line with the Fed.

27. On June 6, 2008, while Wells Fargo was in possession of undisclosed Federal Reserve provided Term Auction Facility loans, Richard M. Kovacevich purchased 40,398 of Wells Fargo stock valued at $1,052,367 and to Plaintiff's knowledge, was not investigated or arrested for Insider Trading and Securities Fraud. http://www.insider-monitor.com/trading/cik72971-3.html

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 15 of 144 28. In an interview on Tuesday, June 10, 2008, while Wells Fargo was borrowing $13.067 billion from the Federal Reserve, representing 15.27% of the company's market capitalization, according to Bloomberg News, John Stumpf stated “...we shared pretty openly with investors and with regulators about the things that we would not do. ...in large part, we avoided the big problems the industry is seeing because of our culture. ...there's always this talk about credit crunch and liquidity crunch, I'm not so sure there's a liquidity crisis. There's plenty of money out there. . Ryssdal: “What does it tell you though, that all these institutions have to go out and raise new capital?” . Stumpf; Well I only think about our institution. We haven't had to do that. I have a general aversion to using public money, our citizen's money, to bail out problems for a particular sector. Why then shouldn't we bail out problems for people who lose money in the stock market and other industries? …If people did things improper, those lenders should be held accountable. But to use public money . . . I don't know where that thing stops. ...In a capitalistic system, those who fly too close to the sun, get burned. . “It's a tough way to say it but that's what happens. ...these are times where we have strong head winds ...and in our company's case, to be able to not only pay for the credit hits we took, we actually added to our reserves. We've added almost 2 billion dollars to our reserves in the last two quarters. We paid a 31 cent dividend, and yet on top of that we still added money to our retained earnings. We added organically to capital..." . Ryssdal: “...overall, Wells Fargo is in pretty good shape, right?” . Stumpf; “I like our chances. ...some of the problems in the industry that have hurt these other banks' competitors, have caused them not to have capital... So yes, it's working to our advantage. http://www.marketplace.org/topics/business/interview-transcript-john-stumpf

29. According to the Bloomberg News, on 6/30/2008, Wachovia's outstanding Federal Reserve provided Term Auction Facility borrowings totaled $10 billion, representing a material 29.82% of the company's market capitalization.

30. A search by Plaintiff of Wachovia Corporation's form 10-Q for the quarterly period ended June 30, 2008, listing North Carolina as the "State or other jurisdiction of incorporation or organization", certified pursuant to 18 U.S.C. Section 1350, as adopted pursuant to section 906 of the Sarbanes-Oxley Act of 2002 by ROBERT K. STEEL on August 11, 2008, does not disclose the type, terms, interest charges, dates, collateral, values or amounts of financial assistance provided by the Fed and other material terms, and to Plaintiff's knowledge, has not been restated since. http://www.otcmarkets.com/edgar/GetFilingHtml?FilingID=6092516

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 16 of 144 31. On July 9, 2008, ROBERT K. STEEL was named president and CEO of Wachovia as the company’s undisclosed Federal Reserve Term Auction Facility (TAF) borrowing reached a material $12.5 billion;

32. On July 22, 2008, Mr. Steel personally purchased 1,000,000 shares of Wachovia’s stock as the company’s undisclosed Federal Reserve Term Auction Facility (TAF) borrowing reached $12.5 billion, representing a material 34.85% of the company's market capitalization.

33. In an interview with CNBC's Jim Cramer On Monday, September 15, 2008, Robert Steel said "I think it's really about...transparency. People have to understand the assets and really be able to say, this is what I own... Complete disclosure. ...we can work through this with transparency, liquidity and capital. ...Our strategy was to give you all the data so you could make your own model. We tell you what we're doing...... we're raising capital ourselves by basically shrinking the balance sheet, cutting the dividend, cutting expenses. We can create more capital ourselves that way... for now, we feel like we can work through this..." After Jim Cramer asked "Should there be any sort of quick regulatory relief from the SEC that would make life easier to be able to make your bank much stronger?", Mr. Steel responded "I don't think it's about my bank." http://www.cnbc.com/id/26728133#.

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 17 of 144 34. On 9/25/2008, when Wachovia borrowed an undisclosed $5 billion from the Fed's Term Auction Facility, Unencumbered Assets, representing the Fed credit line available to Wachovia was $56.848 Billion. The $12.5 billion outstanding borrowings by Wachovia on 9/25/2008 represented a material 42.26% of the companies market capitalization of $29.576 billion. Wachovia's $56.848 Billion in Unencumbered Assets with the Fed represented almost twice the company's market capitalization.

35. A search by Plaintiff of Wachovia Corporation's form 10-Q for the quarterly period ended September 30, 2008, which listed North Carolina as the "State or other jurisdiction of incorporation or organization", certified pursuant to 18 U.S.C. Section 1350, as adopted pursuant to section 906 of the Sarbanes-Oxley Act of 2002 by ROBERT K. STEEL, did not disclose the type, terms, interest charges, dates, collateral, values or amounts of financial assistance provided by the Fed and other material terms, and has not been restated since. http://www.taxpayer.net/user_uploads/file/Bailout/BankBios/WellsFargo/Finance/WACHO VIACORP%2010Q%203rd%20qtr%202008.pdf

After not reporting TAF loans, Wachovia's CEO wrote "I, Robert K. Steel, certify that: I have reviewed this Quarterly Report on Form 10-Q for the quarter ended September 30, 2008 of Wachovia Corporation; Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report" on October 30, 2008."

Wachovia CEO Robert Steel falsely certified Wachovia's Quarterly Report as of September 30, 2008, as the $12.5 billion borrowed by Wachovia on 9/30/2008 represented a material 165.43% of the companies market capitalization.

36. From 2006 through 2008, current SEC Chair Mary Jo White's husband John served as Director of the Division of Corporation Finance at the U.S. Securities and Exchange Commission, which oversees disclosure and reporting by public companies in the United States. Mr. White was head of the SEC division which oversees disclosure and reporting by public companies. "[Mr. White] played an integral role in the SEC’s response to market turmoil throughout 2008, ensuring that the Division acted swiftly to facilitate strategic transactions and access to capital for public companies." http://www.cravath.com/jwhite/

37. On October 3, 2008, Wachovia agreed to be bought by Wells Fargo in an all-stock transaction, the same day the $700 billion Troubled Asset Relief Program (TARP) was signed into law by U.S. President George W. Bush.

"On October 3, 2008, Wells Fargo and Wachovia, in connection with entering into the merger agreement, entered into a share exchange agreement, under which Wells Fargo 18

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 18 of 144 agreed to purchase 10 newly issued shares of Wachovia Series M Preferred Stock, which vote together with Wachovia common stock as a single class and have voting rights equivalent to 39.9% of the total voting power of holders of Wachovia capital stock entitled to vote at the special meeting, in exchange for the issuance of 1,000 shares of Wells Fargo common stock to Wachovia.

Wells Fargo and Wachovia completed the transactions contemplated by the share exchange agreement on October 20, 2008." http://www.sec.gov/Archives/edgar/data/72971/000095012308013965/y72243sv4.htm

38. On October 6, 2008 Wachovia accessed the Fed's Discount Window for a material $29 billion, on top of the $12.5 billion the company borrowed from the TAF, totaling $41.5 billion borrowed from the Federal Reserve, representing a material 332.58% of the company's market capitalization, six days before the merger was approved by the Fed.

39. The Federal Reserve unanimously approved the merger with Wells Fargo on October 12, 2008, as Wachovia's Fed Discount Window borrowings fell to $25 billion, while the firm's TAF borrowings rose to $25 billion, totaling $50 billion borrowed from the Federal Reserve, representing a material 449.72% of the company's market capitalization.

On the same day, Wells Fargo's TAF borrowings were $17.5 billion, representing a material 18.68% of the firm's market capitalization.

40. On October 28, 2008, Wells Fargo received $25 Billion of Emergency Economic Stabilization Act Federal bail-out funds in the form of a preferred stock purchase, while Wachovia and Wells Fargo were in possession of a material $67.5 billion in Discount Window and Term Auction Facility borrowings from the Federal Reserve.

41. On October 31, 2008, WELLS FARGO & COMPANY FORM S-4 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933, which prominently listed James M. Strother, Esq., Executive Vice President and General Counsel of Wells Fargo, stated;

"Liquidity continued to decline and by the end of September 26, Wachovia’s management was concerned that, without accessing the Federal Reserve’s discount borrowing window, Wachovia’s banking subsidiaries would not be able to fund normal banking activities on Monday, September 29. Wachovia had been regularly reviewing its liquidity situation with the Federal Reserve and the OCC, who on that day remained on site.

Wachovia held a telephonic board of directors meeting on Friday, September 26 during which management advised the board of directors of the status of Wachovia’s liquidity situation, the status of the various strategic alternatives, including that the capital raising alternative was no longer a viable option, and the status of discussions with regulatory authorities about Wachovia’s financial condition.

...On Saturday, September 27, and in an early morning meeting on September 28, Mr. Kovacevich, the Chairman of Wells Fargo, told Mr. Steel that Wells Fargo was considering an offer to purchase all of Wachovia in a stock-for-stock transaction, pending completion of due diligence activities. Mr. Kovacevich commented that Wells Fargo was working on a 19

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 19 of 144 transaction that would not require government assistance and that he believed Wells Fargo could meet the Monday morning timetable.

...Wachovia held a telephonic meeting of its board of directors at approximately 9:00 p.m. on September 28 to advise the board of the current situation and the FDIC’s position. Legal counsel discussed with the board matters regarding its fiduciary duties relative to shareholders and, in the existing context, creditors.

The merger agreement also provides that for a period of six years after the merger is completed, Wells Fargo will provide director’s and officer’s liability insurance for the present and former officers and directors of Wachovia with respect to claims arising from facts or events occurring before the merger is completed. This director’s and officer’s liability insurance will contain at least the same coverage and amounts, and terms and conditions no less advantageous, as Wachovia’s existing coverage.

...Wachovia held a telephonic board of directors meeting at 6:30 a.m. on Monday, September 29 to advise the board of the events that had developed during the night. Legal counsel to Wachovia described the terms of the non-binding agreement-in-principle.

Management informed the board that it was faced with two options: (1) execute the agreement-in-principle with Citigroup and the FDIC or (2) have the FDIC place Wachovia’s banking subsidiaries into receivership, which likely would require Wachovia Corporation to file a bankruptcy petition soon thereafter. [GH; But not disclose the Fed credit line information]

...On Thursday, October 2, Wells Fargo had discussions internally and with its legal counsel, Wachtell, Lipton, Rosen & Katz, and its financial advisor, JPMorgan Securities, regarding Wachovia and the announcement about Wachovia and Citigroup. ...Wells Fargo executives reviewed information regarding Wachovia and analyzed the financial implications of a potential transaction.

...In the evening of October 2, the Wells Fargo board of directors met, together with management and Wells Fargo’s legal and financial advisors, to consider the proposed transaction with Wachovia. Following extensive discussion the Wells Fargo board unanimously approved the proposed merger with Wachovia and directed management to execute a merger agreement and deliver it to representatives of Wachovia.

...At Mr. Steel’s request, Chairman Bair next telephoned Jane Sherburne, Wachovia’s General Counsel, and provided additional details of the proposed Wells Fargo transaction, including that it would not require any government assistance...

...The Audit Committee expressly approved Wachovia’s decision not to seek shareholder approval for the issuance and sale of Series M Preferred Stock to Wells Fargo pursuant to the share exchange agreement in reliance on an exception contained in the New York Stock Exchange rules. The Audit Committee members were present during the board discussions ...and had the benefit of those discussions in making the determination regarding Wachovia’s financial viability.

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 20 of 144 ...At approximately 7:00 a.m. on October 3, Wells Fargo and Wachovia issued a joint news release announcing the merger agreement.

...As of the date of this proxy statement-prospectus, Wachovia’s 10 executive officers, excluding Robert K. Steel who is discussed below, in the aggregate held [•] unvested Wachovia stock options at a weighted average exercise price of $[•] per Wachovia share, which will vest upon completion of the merger.

Robert K. Steel Agreement. Wachovia did not enter into an employment agreement with Mr. Steel upon his hiring in July 2008. Mr. Steel received 1,500,000 Wachovia stock options with an exercise price of $9.08 per Wachovia share and 1,990,089 performance-based Wachovia RSAs that vest upon Wachovia common stock reaching certain price thresholds and his continued employment with Wachovia through July 15, 2011. Following the change in control as a result of the merger, all of Mr. Steel’s stock options will vest and be converted into stock options to purchase shares of Wells Fargo common stock, as adjusted by the exchange ratio...

Mr. Steel is also entitled to receive a gross-up payment equal to the amount of federal excise taxes under Section 4999 of the Internal Revenue Code (plus the applicable federal and state income, FICA and excise taxes due on such gross-up payment) payable by him in conjunction with a change in control of Wachovia and such taxes become payable, as a result of payments under the stock award agreement or otherwise, and are deemed to be “excess parachute payments” for federal income tax purposes. The foregoing payments, if any, to Mr. Steel are subject to the limits imposed by Wachovia’s severance policy, which limits the total amount of severance benefits to be paid to any executive to 2.99 times the sum of the executive’s base salary and annual cash incentive award.

No such Company SEC Report or communication, at the time filed, furnished or communicated (and, in the case of registration statements and proxy statements, on the dates of effectiveness and the dates of the relevant meetings, respectively), contained any untrue statement of a material fact or omitted to state any material fact required to be stated therein or necessary in order to make the statements made therein, in light of the circumstances in which they were made, not misleading, except that information as of a later date (but before the date of this Agreement) shall be deemed to modify information as of an earlier date. As of their respective dates, all Company SEC Reports complied as to form in all material respects with the published rules and regulations of the SEC with respect thereto. As of the date of this Agreement, no executive officer of Company has failed in any respect to make the certifications required of him or her under Section 302 or 906 of the Sarbanes-Oxley Act of 2002 (the “Sarbanes-Oxley Act”).

...3.13 Company Information. The information relating to Company and its Subsidiaries that is provided by Company or its representatives for inclusion in the Proxy Statement and Form S-4, or in any application, notification or other document filed with any other Regulatory Agency or other Governmental Entity in connection with the transactions contemplated by this Agreement, will not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements therein, 21

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 21 of 144 in light of the circumstances in which they are made, not misleading. The portions of the Proxy Statement relating to Company and its Subsidiaries and other portions within the reasonable control of Company and its Subsidiaries will comply in all material respects with the provisions of the Exchange Act and the rules and regulations thereunder.

...No such Parent SEC Report or communication, at the time filed, furnished or communicated (and, in the case of registration statements and proxy statements, on the dates of effectiveness and the dates of the relevant meetings, respectively), contained any untrue statement of a material fact or omitted to state any material fact required to be stated therein or necessary in order to make the statements made therein, in light of the circumstances in which they were made, not misleading, except that information as of a later date (but before the date of this Agreement) shall be deemed to modify information as of an earlier date. As of their respective dates, all Parent SEC Reports complied as to form in all material respects with the published rules and regulations of the SEC with respect thereto. As of the date of this Agreement, no executive officer of Parent has failed in any respect to make the certifications required of him or her under Section 302 or 906 of the Sarbanes-Oxley Act.

4.10 Parent Information. The information relating to Parent and its Subsidiaries that is provided by Parent or its representatives for inclusion in the Proxy Statement and the Form S-4, or in any application, notification or other document filed with any other Regulatory Agency or other Governmental Entity in connection with the transactions contemplated by this Agreement, will not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements therein, in light of the circumstances in which they are made, not misleading. The portions of the Proxy Statement relating to Parent and its Subsidiaries and other portions within the reasonable control of Parent and its Subsidiaries will comply in all material respects with the provisions of the Exchange Act and the rules and regulations thereunder. The Form S-4 will comply in all material respects with the provisions of the Securities Act and the rules and regulations thereunder."

IN WITNESS WHEREOF, Company and Parent have caused this Agreement to be executed by their respective officers thereunto duly authorized as of the date first above written.

WELLS FARGO & COMPANY

By: /s/ Richard Kovacevich Name: Richard Kovacevich Title: Chairman

WACHOVIA CORPORATION

By: /s/ Robert K. Steel Name: Robert K. Steel Title: President and CEO

SIGNATURES

WELLS FARGO & COMPANY

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 22 of 144 By: /s/ John G. Stumpf Name: John G. Stumpf Title: President and Chief Executive Officer Pursuant to the requirements of the Securities Act of 1933, this registration statement has been signed on October 31, 2008 by the following persons in the capacities indicated:

/s/ John G. Stumpf John G. Stumpf President and Chief Executive Officer (Principal Executive Officer)

/s/ Howard I. Atkins Howard I. Atkins Senior Executive Vice President and Chief Financial Officer (Principal Financial Officer)

/s/ Richard D. Levy Richard D. Levy Executive Vice President and Controller (Principal Accounting Officer)

John S. Chen* Lloyd H. Dean*

Susan E. Engel* Enrique Hernandez, Jr.*

Robert L. Joss* Richard M. Kovacevich*

Richard D. McCormick* Cynthia H. Milligan*

Nicholas G. Moore* Philip J. Quigley*

Donald B. Rice* Judith M. Runstad*

Stephen W. Sanger* John G. Stumpf*

Susan G. Swenson* Michael W. Wright*

* John G. Stumpf, by signing his name hereto, does hereby sign this document on behalf of each of the directors named above pursuant to powers of attorney duly executed by such persons.

/s/ John G. Stumpf John G. Stumpf Attorney-in-Fact http://www.sec.gov/Archives/edgar/data/72971/000095012308013965/y72243sv4.htm#146

42. On October 31, 2008, WELLS FARGO & COMPANY FORM S-4 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 also stated;

"The Series M, Class A Preferred Stock was issued to Wells Fargo in connection with the entry into the merger agreement by Wells Fargo and Wachovia and represents 39.9% of the total voting power of holders of Wachovia capital stock entitled to vote at the special meeting (including on the approval of the plan of merger contained in the merger agreement). Wells Fargo is the sole holder of all shares of Series M, Class A Preferred

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 23 of 144 Stock and has informed Wachovia that it intends to vote these shares in favor of approving the plan of merger contained in the merger agreement.

...In connection with entering into the merger agreement, Wachovia and Wells Fargo also entered into a share exchange agreement pursuant to which Wachovia issued, on October 20, 2008, 10 shares of its Series M, Class A Preferred Stock to Wells Fargo in exchange for the issuance by Wells Fargo to Wachovia of 1,000 shares of Wells Fargo common stock. The Series M, Class A Preferred Stock issued to Wells Fargo votes together with Wachovia common stock as a single class and represents 39.9% of the total voting power of holders of Wachovia capital stock entitled to vote at the special meeting (including on the approval of the plan of merger contained in the merger agreement).

On October 3, 2008, Wells Fargo and Wachovia, in connection with entering into the merger agreement, entered into a share exchange agreement, under which Wells Fargo agreed to purchase 10 newly issued shares of Wachovia Series M Preferred Stock, which vote together with Wachovia common stock as a single class and have voting rights equivalent to 39.9% of the total voting power of holders of Wachovia capital stock entitled to vote at the special meeting, in exchange for the issuance of 1,000 shares of Wells Fargo common stock to Wachovia.

Wells Fargo and Wachovia completed the transactions contemplated by the share exchange agreement on October 20, 2008." http://www.sec.gov/Archives/edgar/data/72971/000095012308013965/y72243sv4.htm

43. On October 31, 2008, WELLS FARGO & COMPANY FORM S-4 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 also stated Goldman Sachs opinion;

"...Neither the mailing of this document to Wachovia shareholders nor the issuance by Wells Fargo of its common stock in the merger will create any implication to the contrary.

Wachovia has supplied all information relating to Wachovia contained or incorporated by reference in this document, and Wells Fargo has supplied all information relating to Wells Fargo contained or incorporated by reference in this document." [Robert] Steel, 62, who had previously worked with Peter Weinberg at Goldman Sachs Group Inc., considered joining Perella Weinberg when the firm opened its doors in 2006...

Instead he went to work for the government, where he was a Treasury under secretary before he became CEO of Wachovia in July 2008

http://www.bloomberg.com/news/2014-05-28/perella-weinberg-names-ex-treasury-official- robert-steel-ceo.html

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 24 of 144 3.12 Opinion. The Board of Directors of Company has received the opinions of Goldman Sachs & Co. and Perella Weinberg Partners, to the effect that, as of the date hereof, and based upon and subject to the factors and assumptions set forth therein, the Merger Consideration is fair from a financial point of view to the holders of Company Common Stock."

APPENDIX B states;

October 3, 2008

"In connection with this opinion, we have reviewed, among other things, certain internal financial analyses and forecasts for the Company prepared by the Company’s management; estimates by the Company’s management as to the Company’s liquidity, as well as certain analyses prepared by the Company’s management with respect to the Company’s leverage and capital adequacy...

We have also held discussions with members of the senior management of the Company regarding their assessment of the rationale for the Transaction, the past and current business operations, financial condition and future prospects of the Company and the fair market value of certain key asset categories of the Company.

...In particular, you have informed us that: the Company’s liquidity position is severely strained due in large part to declining customer and counterparty confidence, and that the Company may have insufficient unrestricted cash on hand to meet its needs in the near term; the Company and its principal operating subsidiaries have a limited amount of unencumbered assets available as collateral for any financings that the Company may seek to obtain on an immediate basis;

...the United States banking regulators have not offered financial assistance to the Company on a stand-alone basis to adequately address the financial situation of the Company, including its immediate and long term liquidity needs;'

...absent immediately entering into a definitive transaction (such as the Transaction) that would provide the Company with sources of substantial ongoing liquidity and funding or that would relieve the Company of the need for such liquidity and funding, the Company and its subsidiaries would face intervention by the United States federal banking regulators and/or be required to seek protection under applicable bankruptcy laws.

...we also considered recent instances where concerns regarding the liquidity of a bank or financial institution triggered a rapid deterioration of the institution’s financial condition, necessitating government intervention or bankruptcy protection, and as a result of which the common equity holders of the institution are likely to receive substantially diminished value, if any at all, for their equity.

...For purposes of rendering this opinion, we have relied upon and assumed, without assuming any responsibility for independent verification, the accuracy and completeness of all of the financial, legal, regulatory, tax, accounting and other information provided to, discussed with or reviewed by us. 25

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 25 of 144

...under the ownership of a company with adequate liquidity and capital, such as Parent, the value of the Company and its subsidiaries could substantially improve, resulting in significant returns to Parent if the Transaction is consummated.

This opinion has been approved by a fairness committee of Goldman, Sachs & Co. Based upon and subject to the foregoing, including the various assumptions and limitations set forth herein, as well as the extraordinary circumstances facing the Company described herein, it is our opinion that, as of the date hereof, the Exchange Ratio is fair from a financial point of view to the Holders.

Very truly yours,

/s/ Goldman, Sachs & Co. Goldman, Sachs & Co."

44. On October 31, 2008, WELLS FARGO & COMPANY FORM S-4 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 also stated Perella Weinberg Partners opinion;

"Pursuant to engagement letters dated September 28, 2008 and October 1, 2008, Goldman Sachs is entitled to receive a transaction fee of $25 million for its services in connection with the merger, of which $20 million is contingent upon consummation of the merger. Pursuant to an engagement letter dated September 28, 2008, Perella Weinberg is entitled to receive fees for its services, of which $5 million was payable upon the execution of the merger agreement, and $20 million is contingent upon the closing of the merger.

[Robert] Steel, 62, who had previously worked with Peter Weinberg at Goldman Sachs Group Inc., considered joining Perella Weinberg when the firm opened its doors in 2006...

Instead he went to work for the government, where he was a Treasury under secretary before he became CEO of Wachovia in July 2008

http://www.bloomberg.com/news/2014-05-28/perella-weinberg-names-ex-treasury-official- robert-steel-ceo.html

Certain of Wachovia’s executive officers and directors have interests in the merger as individuals that are different from, or in addition to, the interests of Wachovia shareholders generally. The Wachovia board of directors was aware of these interests and considered them, among other matters, in adopting the merger agreement and the transactions contemplated by the merger agreement.

APPENDIX C states;

Letterhead of Perella Weinberg Partners

October 3, 2008

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 26 of 144 We understand that Wachovia Corporation, a North Carolina corporation (the “Company”), is considering a transaction whereby Wells Fargo & Company (“Parent”) will effect a merger involving the Company.

For purposes of the opinion set forth herein, we have, among other things:

...reviewed certain internal financial statements, analyses and forecasts, and other financial and operating data relating to the business of the Company, in each case, prepared by the Company’s management; discussed the past and current operations, financial condition and future prospects of the Company with senior executives of the Company; reviewed estimates by the Company’s management as to the Company’s liquidity, as well as certain analyses prepared by the Company’s management with respect to the Company’s leverage and capital adequacy; reviewed the Merger Agreement; and conducted such other financial studies, analyses and investigations, and considered such other factors, as we have deemed appropriate.

In particular, you have informed us that: the Company’s liquidity position is severely strained due in large part to declining customer and counterparty confidence, and that the Company may have insufficient unrestricted cash on hand to meet its needs in the near term; the Company and its principal operating subsidiaries have a limited amount of unencumbered assets available as collateral for any financings that the Company may seek to obtain on an immediate basis; the United States banking regulators have not offered financial assistance to the Company on a stand-alone basis to adequately address the financial situation of the Company, including its immediate and long term liquidity needs; absent immediately entering into a definitive transaction (such as the Merger) that would provide the Company with sources of substantial ongoing liquidity and funding or that would relieve the Company of the need for such liquidity and funding, the Company and its subsidiaries would face intervention by the United States federal banking regulators and/or be required to seek protection under applicable bankruptcy laws.

...In arriving at our opinion, we have assumed and relied upon, without independent verification, the accuracy and completeness of the financial and other information supplied or otherwise made available to us (including information that is available from generally recognized public sources) for purposes of this opinion and have further assumed that the 27

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 27 of 144 information furnished by the management of the Company for purposes of our analysis does not contain any material omissions or misstatements of material fact.

...We note, however, that, under the ownership of a company with adequate liquidity and capital, such as Parent, the value of the Company and its subsidiaries could substantially improve, resulting in significant returns to Parent if the Merger is consummated.

...We have acted as financial advisor to the Board of Directors of the Company in connection with the Merger and will receive fees for our services, a portion of which is payable upon the execution of definitive agreements in respect of the Merger and a substantial portion of which is contingent upon the closing of the Merger.

...The issuance of this opinion was approved by a fairness committee of Perella Weinberg Partners LP.

...Based upon and subject to the foregoing, including the various assumptions and limitations set forth herein, as well as the extraordinary circumstances facing the Company described herein, we are of the opinion that, on the date hereof, the Exchange Ratio is fair from a financial point of view to the Holders.

Very truly yours,

/s/ Perella Weinberg Partners LP PERELLA WEINBERG PARTNERS LP"

45. On November 12, 2008, the Business Journal wrote "North Carolina State Treasurer Richard Moore slammed Wells Fargo & Co.’s proposed purchase of Wachovia Corp., calling the deal “highway robbery.”

In a Wednesday morning appearance on CNBC’s Squawk Box, Moore said it didn’t make sense for the federal government to have engineered a buyout of Wachovia.

...it’s not a fair deal, he says, in light of the number of banks the government is propping up with its “troubled asset relief program.” Under TARP, banks are getting cash infusions by selling preferred stock directly to the government.

All of the nation’s big banks, Moore told CNBC, are participating in the program, and he thinks Wachovia should have been kept alive until it received the same opportunity.

...“We’re going to be cashed out of our Wachovia stock at around $6 or $7 when I can’t find anyone who tells me that given time, under the TARP, it’s a $25 stock,” Moore says.

...As of Oct. 31, CNBC says, the state pension fund owned 3.22 million shares of Wachovia (NYSE: WB).

Moore also expressed consternation at a controversial provision of the Wells-Wachovia deal that essentially guaranteed the sale would go through over any shareholder objection. In October, Wachovia issued preferred stock to Wells that gave Wells 40 percent of the ballots to be cast in the shareholder vote on the deal." http://www.bizjournals.com/sanfrancisco/stories/2008/11/10/daily64.html?page=all

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 28 of 144 46. On November 29, 2008, Mack Sperling of Brooks Pierce wrote "North Carolina's Attorney General And State Treasurer Duke It Out"

"One of the unusual things about the litigation over the Wachovia-Wells Fargo merger ...was the flood of letters and emails written to the Court. Judge Diaz received over 200 pieces of correspondence about the case.

The most high profile of those communications was the one from State Treasurer Richard Moore... Ever since Moore wrote his letter, I've been wondering why he didn't move to intervene in the case. That would have let him speak directly on behalf of the North Carolina Retirement System (the NCRS), which has lost nearly $20 million on its investment in Wachovia.

...In filings in the Southern District, the North Carolina Attorney General and the State Treasurer had gone to war over the authority of the State Treasurer to initiate the litigation and to retain outside counsel to represent the NCRS.

This is a thorny and interesting issue of the power of the State Treasurer versus that of the Attorney General. Maybe it will be resolved one day in a court closer to home." http://www.ncbusinesslitigationreport.com/2008/11/articles/class-actions/north-carolinas- attorney-general-and-state-treasurer-duke-it-out/

47. On November 4, 2005, Defendant's attorney Robert Fuller contributed $1,000 to North Carolina Attorney General Roy Cooper. Thirteen other Robinson Bradshaw employees contributed to Cooper in 2008. In 2008, thirty one political contributions were received from Robinson Bradshaw employees by Richard Moore's successor, North Carolina Treasurer Janet Cowell, who chose not to publicly pursue the Wells Fargo merger related issues. As Robinson Bradshaw was or became external council for the North Carolina Treasurer, fifty contributions from the firm were conveyed to Cowell in 2012.

48. On November 17, 2008, Robinson Bradshaw's Robert Fuller obtained the "AFFIDAVIT OF DONA DAVIS YOUNG" on Wells Fargo's Wachovia merger litigation which stated;

"Wachovia's management kept the Board well and promptly informed of the events, efforts and developments that occurred both before and after September 16th, and obtained guidance and direction from the Board as appropriate on a timely basis.

...Employees with Wachovia's Treasury and Balance Sheet Management group met with the Board on Friday, September 26th and informed the Board that Wachovia would have questionable and unpredictable financing needs during the week of Monday, September 29th' and that at some point during the week, Wachovia would likely have to access the Federal Reserve's discount window for liquidity.

They informed us that Wachovia's liquidity position (cash available to meet current obligations) had declined alarmingly and that the Lehman bankruptcy, Washington Mutual's failure, and other events that began to adversely impact Wachovia in mid September had made it impossible for Wachovia to access its normal sources of liquidity.

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 29 of 144 On October 3, before approving the merger with Wells Fargo, the Board discussed the urgent need for Wachovia to be able to obtain funding to sustain its operations pending a closing of the merger. We were informed and understood that, absent the ability to obtain significant immediate funding from Wells Fargo and substantial assurance to the financial markets and the Federal Reserve that the merger with Wells Fargo was likely to be closed, it was extremely unlikely that Wachovia would be able to avoid receivership pending consummation of a merger with Wells Fargo. The company's advisors and Mr. Steel told the Board that unless a definitive merger agreement was signed with Wells Fargo or a transaction was finalized with Citigroup by the end of the day Friday, October 3, they believed the FDIC was prepared to place Wachovia's banking subsidiaries into receivership.

...it was equally important that the financial markets and the Federal Reserve have the same assurance so that Wachovia could obtain funding from these sources as well. Absent the ability to obtain such funding, Wachovia faced receivership, which would have destroyed the value of Wachovia as a business franchise and left the shareholders with worthless stock.

Shortly after the merger agreement was signed and the merger was announced, Wachovia was able to obtain the financing it needed from Wells Fargo and from other sources of funding.

...Wachovia's Board had thoroughly explored all options available for raising capital

...Wachovia's financial advisors (Goldman Sachs and Perella Weinberg) informed Wachovia that the type of analysis customarily performed was not meaningful for Wachovia because of the extraordinary circumstances faced by Wachovia and its severe liquidity crisis...

...These advisors indicated that the Wells Fargo merger proposal was fair to the Wachovia shareholders.

...Except for Mr. Steel, Wachovia's Board is comprised of outside directors"

This 17th day of November, 2008. /s/ Robert W. Fuller Robert W. Fuller N.C. State Bar No. 10887

ROBINSON, BRADSHAW & HINSON, P.A. 101 North Tryon Street, Suite 1900 Charlotte, North Carolina 28246 Attorneys for Wachovia Defendants http://www.ncbusinesslitigationreport.com/uploads/file/Young%20Affidavit.pdf

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 30 of 144 49. On November 17, 2008, Robinson Bradshaw's Robert Fuller filed a BRIEF OF DEFENDANT WACHOVIA CORPORATION AND OF INDIVIDUAL DEFENDANTS OPPOSING PRELIMINARY INJUNCTION in defense of the Wells Fargo Wachovia merger which stated;

"In the three-week period prior to October 3, Wachovia experienced an acuted liquidity crisis that, ...placed Wachovia on the brink of recievership." without disclosing Wachovia's Discount Window or TAF loans and available credit lines.

And "Without the Wells merger, Wachovia either had to pursue a sale of assets ... or go into FDIC receivership and suffer a complete and certain loss of its shareholders' equity." without disclosing Wachovia's Discount Window or TAF loans and available credit lines.

And "financial market participants, depositors, and other counterparties had begun refusing to deal with Wachovia" because Wachovia's Robert Steel didn't disclose the firm's TAF loans and available credit lines.

And "The merger agreement had the desired effect of providing assurance to third parties that allowed Wachovia to obtain access to capital and recover stability" because Wachovia's Robert Steel, the sole inside director of Wachovia Corporation, chose to not disclose the firm's TAF loans and available access to capital via Fed credit lines.

And "Despite diligent, persistent, and continuous efforts after the board meeting on September 16 to raise capital, sell assets ... Wachovia had been unable to reach any difinitive agreement with a third party that would allow Wachovia to resolve its liquidity issues and avoid FDIC receivership" after only borrowing $2.5 billion on September 11, 2008 from the TAF, with Unencumbered Collateral held with the Fed totaling $56.838 billion, representing a credit line worth tens of billions Robert Steel knew about but the rest of the board and Robert Fuller may not have.

And "as of the night of October 2-3, it was likely that Wachovia would not be able to fund normal banking activities going forward" after borrowing $5 billion for the TAF with $56.848 billion of Unencumbered Collateral held with the Fed on September 25, 2008. http://www.ncbusinesslitigationreport.com/uploads/file/Wachovia%20PI%20Brief.pdf

50. On December 22, 2008, Wachovia borrowed $10 billion at 0.528% from the Federal Reserve for 17 days with $76.280 billion in Unencumbered Collateral representing an undisclosed credit line with the Fed more than six times the size of Wachovia's market capitalization, none of which was disclosed to Wachovia's shareholders or the public before, during and after the merger with Wells Fargo. (Loan maturity - January 8, 2009, after the merger)

51. On December 4, 2008, Wells Fargo borrowed $10 billion at 0.42% from the Federal Reserve for 84 days with $56.796 billion in Unencumbered Collateral representing an undisclosed credit line with the Fed, none of which was disclosed to Wells Fargo's shareholders or the public before, during and after the merger with Wachovia. (Loan maturity - February 26, 2009, after the merger) 31

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 31 of 144 52. Wachovia's stock price on date of first TAF loan: 3/27/2008 - Last Trade: 27.07

Wachovia price on date of completed merger with Wells: 12/31/2008 - Last Trade: 5.54

As of January 31, 2008, there were 1,981,983,990 Wachovia shares outstanding.

27.07 - 5.54 = 21.53 x 1,981,983,990 = $42,672,115,304.70 Wachovia market capitalization lost between the first undisclosed TAF loan and Wells Fargo merger.

53. Zions Bancorporation's fiscal year ended December 31, 2008 form 10-k states; "In December 2007, the Federal Reserve Board announced a new program, the Term Auction Facility (“TAF”), to make 28 day loans to banks in the United States and to foreign banks through foreign central banks. These loans are made using an auction process. Zions Bank is currently participating in the TAF and may continue to do so as long as money can be borrowed at an attractive rate. The amount that can be borrowed is based upon the amount of collateral that has been pledged to the Federal Reserve Bank. At December 31, 2008, $1.8 billion in borrowings were outstanding under this program as compared to $450 million at December 31, 2007. However, by February 13, 2009, the TAF borrowings outstanding had been reduced to $500 million. At December 31, 2008, the amount available for additional Federal Reserve borrowings was approximately $4.3 billion, which had increased to $5.7 billion by February 13, 2009. An additional $1.3 billion could be borrowed at December 31, 2008 upon the pledging of additional available collateral.

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 32 of 144 At December 31, 2008, the Company’s subsidiary banks had a total of $13.1 billion of immediately available, unused borrowing capacity at the Fed and various FHLBs, which had increased to $14.3 billion as of February 13, 2009." http://www.sec.gov/Archives/edgar/data/109380/000119312509040927/d10k.htm 54. Goldman Sach’s Stephen Friedman and the Federal Reserve;

"Stephen Friedman, a former director of Goldman Sachs, was named Chairman of the Federal Reserve Bank of New York in January 2008. Although he had retired from Goldman in 1994, Friedman continued to own stock in the firm. Goldman's conversion from a securities firm to a bank holding company in September 2008 meant it was now regulated by the Fed and not the SEC.

...Friedman was granted a temporary one-year waiver of a rule that forbids "class C" directors of the Fed from direct interest with those it regulates. Friedman agreed to remain on the board until the end of 2009 to provide continuity in the wake of the turmoil caused by Lehman Brothers' bankruptcy.

...Media reports in May 2009 concerning Friedman's involvement with Goldman, and in particular, his purchase of the firm's stock when it traded at historical lows in the fourth quarter of 2008, fueled controversy and criticism over what was seen as a conflict of interest in Friedman's new role as supervisor and regulator to Goldman Sachs.

These events prompted his resignation on May 7, 2009.

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 33 of 144 Although Friedman's purchases of Goldman stock did not violate any Fed rule, statute, or policy, he said that the Fed did not need this distraction. He also stated his purchases, made while approval of a waiver was pending, were motivated by a desire to demonstrate confidence in the company during a time of market distress." http://en.wikipedia.org/wiki/Goldman_Sachs

55. On January 1st, 2008, Plaintiff had 60.9586 Shares/Units of Wachovia Stock Non- ESOP the company's ERISA governed 401(k) savings plan with a Beginning Balance of $922.01, losing $267.04 by March 31, 2008.

From January 1st, 2008 to March 31, 2008 Plaintiff contributed $207.21 to Wachovia Stock Non-ESOP leaving an Ending Balance of $862.18 and 79.3237 Shares/Units

Plaintiff's Wachovia Stock Non-ESOP Ending Balance on June 30, 2008 was $618.68 with 96.7049 Shares/Units after contributing $146.67, losing $390.17.

Plaintiff's Wachovia Stock Non-ESOP Ending Balance on September 30, 2008 was $243.68 with 128.7342 Shares/Units after contributing $152.25, losing $390.17.

Plaintiff's Wachovia Stock Non-ESOP Ending Balance on December 31, 2008 was $755.39 with 248.9493 Shares/Units after contributing $354.74, earning $156.97.

From January 1st, 2008 to December 31, 2008, Plaintiff began with $922.01 of Wachovia Stock Non-ESOP, contributing $860.87 for a total of $1,782.88 in principal, for a loss of $1,027.49 in 2008.

56. Wells Fargo “Fourth Quarter 2008: Successfully closed Wachovia acquisition on December 31, 2008

Significantly reduced the risk, or “de-risked,” the balance sheet and future earnings stream of the new Wells Fargo

De-risking at Wachovia: No plans to request additional TARP capital

Fourth quarter net loss of $2.55 billion, or $0.79 per share, included the following significant items: The decline in profitability was caused by adding $8.1 billion to credit reserves…

The fundamentals of our time-tested business model, however, are as sound as ever.

…our company at year-end 2008 was one of the world’s strongest financial institutions.

Wells Fargo Bank, N.A. has the highest credit rating currently given to U.S. banks by Moody’s Investors Service, “Aa1” and Standard & Poor’s Ratings Services, “AA+.” https://www.wellsfargo.com/pdf/press/4q08pr.pdf

57. Wells Fargo's 2008 Annual Report; https://www08.wellsfargomedia.com/downloads/pdf/invest_relations/wf2008annualreport.p df

Word search for "Term Auction" results = Zero.

Word search for "Discount Window" results = Zero. 34

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 34 of 144 58. On December 31, 2008, Wachovia had no borrowings from the Fed's Discount Window, and $40 billion in borrowings from the TAF, while Wells Fargo was borrowing $32.5 billion from the TAF totaling a material $72.5 billion borrowed on the eve of a merger transaction executives from both companies said the government wasn't involved, and did not assist in.

59. Wells Fargo's 2008 annual report makes no mention of the overall size of Federal Reserve provided Term Auction Facility credit lines, interest rates and maturities, all of which were material inside information known to Wells Fargo CEO John Stumpf and Wachovia CEO Robert Steel, but not know to most of Wachovia shareholders, Congress, the public and what looks like Wachovia's board, who voted for the merger on the advice of Robert Steel, Goldman Sachs, where Robert Steel spent three decades and Perella Weinberg, whose Peter Weinberg worked with Steel while at Goldman Sachs.

60. After Wachovia's Robert Steel paid Perella Weinberg Partners $25 million in 2008 and 2009 to assist in a merger with material omissions, chances are Robert Steel has since received compensation as the new CEO of Perella Weinberg Partners in 2014.

61. On 3/13/2007, Plaintiff purchased shares of SDS in his own account. SDS is a leveraged inverse Exchange Traded Fund (ETF), whose objective is to rise 2% for every 1% the S&P 500 falls. In the fourth quarter of 2008 Plaintiff sold SDS in two blocks, realizing a total gain of about 51%. In July, 2007, Plaintiff shorted Bear Stearns in his own account and closed the position with a 97% profit on 3/7/2008. “Shorting” means making an investment that increases in value when other “long” investments fall. Plaintiff shorted Pulte Homes, KB Homes and Lennar in his own account, and realized about a 65% gain in October, 2008.

Plaintiff was one of the only advisors at Wells Fargo who did well in the downturn.

Many of Plaintiff's clients entered into many similar trades at relatively the same time as the account performance reports show, which illustrate some of the best un-audited Asset Advisor performance reports in my book of business as of June, 2010.

During 2008, Plaintiff executed short trades in Goldman Sachs, Capital One, MBIA, Merrill Lynch, Moody’s and State Street Corporation, as well as buying and selling inverse ETF’s covering financials and real estate.

On 3/31/2009 Plaintiff had more than 60 Asset Advisor accounts subject to the Investment Advisers Act of 1940, where the financial advisor has a fiduciary duty to act in the best interest of clients, in which advisors must disclose any conflict, or potential conflict, to their clients prior to and during a contractual business engagement.

On 3/31/2009, total assets under management in Plaintiff's book of business was $35,595,572.83, including both fiduciary and non fiduciary accounts.

The solid blue line on the performance report charts for the period ending 6/30/2014 below on the next page indicate how much more Plaintiff's clients made and\or lost compared to the dotted lines which represent selected indices.

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 35 of 144

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 36 of 144

62. In the Matter of; George Hartzman, Complainant, v. Wells Fargo Advisors, LLC., Respondent, Case No. 2013-SOX-00045 with the United States Department of Labor, Office of Administrative Law Judges, presided over by Judge Kenneth A. Krantz, Wells Fargo declined to provide the following account related discovery requests of February 27, 2014;

Request for Production of Documents 6;

Please provide George Hartzman's Wells Fargo personnel file, including A; the number of client accounts managed by George Hartzman in 2007, 2008, 2009, 2010, 2011 and B; as of October 8, 2012, the number of new client accounts opened by George Hartzman in 2007, 2008, 2009, 2010, 2011 and C; as of October 8, 2012, the total assets managed by George Hartzman in 2007, 2008, 2009, 2010, 2011 and D; as of October 8, 2012, how many clients transferred accounts away from George Hartzman in 2007, 2008, 2009, 2010, 2011 and E; as of October 8, 2012, the number of accounts managed by George Hartzman, which were governed by the Investment Advisers Act of 1940 in 2007, 2008, 2009, 2010, 2011 and F; October 8, 2012, and the total of George Hartzman’s gross revenue production in 2007, 2008, 2009, 2010, 2011 and as of October 8, 2012.

63. In "Markets at a glance December 2009", Eric Sprott and David Franklin wrote;

“The majority buyers of Treasury securities in 2009 were:

1. Foreign and International buyers who purchased $697.5 billion.

2. The Federal Reserve who bought $286 billion.

3. The Household Sector who bought $528 billion to Q3 – which puts them on track purchase $704 billion for…2009. [Source: US Treasury, Flows and Outstandings, 3rd Quarter, 2009]

…we were surprised to discover that "Households" had bought so many Treasuries in 2009. They bought 35 times more government debt than they did in 2008. …This enormous “Household” investment was made outside of Money Market Funds, Mutual Funds, ETF’s, Life Insurance Companies, Pension and Retirement funds and Closed-End Funds, which are all separate reporting categories.

…2009 has been witness to spectacular government intervention in almost all levels of the economy. This support requires outside capital to facilitate, and relies heavily on the US government’s ability to raise money in the debt market…

…the regular buyers of US debt are no longer buying…

So to answer the question - who is the Household Sector? They are a PHANTOM. They don’t exist. They merely serve to balance the ledger in the Federal Reserve’s Flow of Funds Report.

The fact that the Federal Reserve and US Treasury cannot identify the second largest buyer of treasury securities this year proves that the traditional buyers are not keeping pace with the US government’s deficit spending. It makes us wonder if it’s all just a Ponzi scheme.”

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 37 of 144 64. On 12/31/2009, TrimTabs' Charles Biderman wrote "Are Federal Reserve and U.S. Government Rigging Stock Market? We Have No Evidence They Are, but They Could Be.

We Do Not Know Source of Money That Pushed Market Cap Up $6+ Trillion since Mid- March.

We cannot identify the source of the new money that pushed stock prices up so far so fast. For the most part, the money did not from the traditional players that provided money in the past... If the money to boost stock prices did not come from the traditional players, it had to have come from somewhere else. We do not know where all the money has come from. What we do know is that the U.S. government has spent hundreds of billions of dollars to support the auto industry, the housing market, and the banks and brokers.

...In an article in the Daily Telegraph in 2006, former Clinton administration official George Stephanopoulos mentioned the existence of “an informal agreement among the major banks to come in and start to buy stock if there appears to be a problem.”

Think back to mid-March 2009. Nothing positive was happening, and investor sentiment was horrible. The Fed, the Treasury, and Wall Street were all trying to figure out how to prevent the financial system from collapsing. The Fed was willing to print whatever amount of money it took to bail out the system.

What if Ben Bernanke, Timothy Geithner, and the head of one or more Wall Street firms decided that creating a stock market rally was the only way to rescue the economy?

...This type of intervention could explain some of the unusual market action in recent months, with stock prices grinding higher on low volume even as companies sold huge amounts of new shares and retail investors stayed on the sidelines.

...We want to emphasize that we have no evidence that the Fed or the Treasury are throwing money into the stock market, either directly or indirectly. But if they are not pumping up stock prices, then who else is?" http://www.zerohedge.com/article/trimtabs-asks-who-responsible-non-stop-market-rally- march-gives-some-suggestions

65. Robert Steel resigned his seat on the Wells Fargo board before being appointed by New York City Mayor Michael Bloomberg, whose Bloomberg News declined to report Wachovia and Wells Fargo's Fed credit lines amongst what looks like all others other than Morgan Stanley's in one news article, to serve as Deputy Mayor for Economic Development on June 22, 2010.

66. On September 1, 2010, Scott G. Alvarez, General Counsel of the Federal Reserve, testified "Before the Financial Crisis Inquiry Commission", on "The Acquisition of Wachovia Corporation by Wells Fargo & Company" without mentioning the size of Wachovia and Wells Fargo's 2008 and 2009 credit lines with the Fed;

"...I am pleased to appear today to provide the Commission with information on the events leading up to the acquisition of Wachovia Corporation and its banking and nonbanking subsidiaries by Wells Fargo & Company in the fall of 2008. The purpose of my testimony is 38

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 38 of 144 to summarize the events, with a focus on the Federal Reserve's involvement. I will also address the lending and supervisory questions raised in the Commission's invitation letter.

...On September 25, 2008, the Federal Deposit Insurance Corporation (FDIC) seized and sold Washington Mutual Bank (WaMu), then the largest thrift in the United States.

...The day after the failure of WaMu, Wachovia Bank depositors accelerated the withdrawal of significant amounts from their accounts. In addition, wholesale funds providers withdrew liquidity support from Wachovia. It appeared likely that Wachovia would soon become unable to fund its operations...

...At the time, U.S. banking organizations were extremely vulnerable to a loss of confidence by wholesale suppliers of funds. Markets were already under considerable strain after the events involving Lehman Brothers, AIG, and WaMu...

At the time, Wachovia was considered "well capitalized" by regulatory standards and until very recently had not generally been thought to be in danger of failure, so there were fears that the failure of Wachovia would lead investors to doubt the financial strength of other organizations in similar situations, making it harder for those institutions to raise capital and other funding.

For these reasons, on September 28, 2008, the Board by unanimous vote determined that compliance by the FDIC with the least-cost requirements of the FDI Act with respect to Wachovia Bank and its insured depository institution affiliates would have serious adverse effects on economic conditions and financial stability, and that action or assistance by the FDIC permitted under the systemic risk exception within the act would avoid or mitigate these adverse effects.

Similar determinations were made by the board of directors of the FDIC and the Secretary of the Treasury, in consultation with the President, which allowed the FDIC to consider measures outside the least-cost resolution requirement to resolve Wachovia, including the provision of so-called "open bank" assistance.

...Based on an IRS notice issued September 30, Wells Fargo had determined that certain U.S. federal income tax benefits resulting from the proposed Wachovia transaction would allow it to acquire Wachovia without FDIC assistance.

On October 3, 2008, Wachovia's board of directors voted to accept the Wells Fargo offer, and the parties signed a binding merger agreement...

...In light of the emergency affecting the financial markets, and as permitted by the BHC Act and Federal Reserve regulations, the Board waived public notice of the proposal and shortened the notice period to the primary regulators of the banks and thrifts involved. These agencies, and the Department of Justice, indicated that they had no objection to approval of the proposal.

...The Federal Reserve did not provide any emergency financial assistance in connection with the Wells Fargo-Wachovia merger...

...While emergency credit was not sought or given in connection with the Wachovia transaction, Wachovia's depository institutions accessed the Federal Reserve's discount 39

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 39 of 144 window at various times throughout 2008. The discount window comprises several credit facilities open to insured depository institutions on a regular basis and is not limited to emergency credit like section 13(3).

The Wachovia depository institutions accessed these facilities on the same terms and conditions applicable to other depository institutions, including the completion of required documentation and the pledging of collateral to the Federal Reserve. Many other depository institutions accessed the discount window during this period as well." http://www.federalreserve.gov/newsevents/testimony/alvarez20100901a.htm

67. Wachovia TAF and Discount Window Fed borrowings per the Fed and Bloomberg from10/3/2008 to 1/1/2009, with Unencumbered Collateral held at the Federal Reserve at the end of some lines in bold;

DATE...... BALANCE.....MKT CAP...% CAP...... TAF...... DW...... UC

10/3/2008...$12,500.00....$13,406.49...93.24%...$12,500.00...$0.00 10/4/2008...$12,500.00....$13,406.49...93.24%...$12,500.00...$0.00 10/5/2008...$12,500.00....$13,406.49...93.24%...$12,500.00...$0.00 10/6/2008...$41,500.00....$12,478.18...332.58%...$12,500.00...$29,000.00 10/7/2008...$41,500.00....$11,333.99...366.16%...$12,500.00...$29,000.00 10/8/2008...$37,500.00....$10,923.81...343.29%...$12,500.00...$25,000.00 10/9/2008....$50,000.00....$7,771.88....643.35%...$25,000.00...$25,000.00...$29,396.40 10/10/2008...$50,000.00...$11,118.10...449.72%...$25,000.00...$25,000.00 10/11/2008...$50,000.00...$11,118.10...449.72%...$25,000.00...$25,000.00 10/12/2008...$50,000.00...$11,118.10...449.72%...$25,000.00...$25,000.00 10/13/2008...$50,000.00...$12,501.45...399.95%...$25,000.00...$25,000.00 10/14/2008...$50,000.00...$13,622.38...367.04%...$25,000.00...$25,000.00 10/15/2008...$50,000.00...$13,082.66...382.19%...$25,000.00...$25,000.00 10/16/2008...$50,000.00...$13,924.61...359.08%...$25,000.00...$25,000.00 10/17/2008...$50,000.00...$12,888.36...387.95%...$25,000.00...$25,000.00 10/18/2008...$50,000.00...$12,888.36...387.95%...$25,000.00...$25,000.00 10/19/2008...$50,000.00...$12,888.36...387.95%...$25,000.00...$25,000.00 10/20/2008...$50,000.00...$13,104.25...381.56%...$25,000.00...$25,000.00 10/21/2008...$50,000.00...$13,147.43...380.30%...$25,000.00...$25,000.00 10/22/2008...$50,000.00...$12,202.27...409.76%...$25,000.00...$25,000.00 10/23/2008...$50,000.00...$12,309.12...406.20%...$35,000.00...$15,000.00...$33,997.80 10/24/2008...$50,000.00...$12,394.60...403.40%...$35,000.00...$15,000.00 10/25/2008...$50,000.00...$12,394.60...403.40%...$35,000.00...$15,000.00 10/26/2008...$50,000.00...$12,394.60...403.40%...$35,000.00...$15,000.00 10/27/2008...$50,000.00...$12,266.38...407.62%...$35,000.00...$15,000.00 10/28/2008...$50,000.00...$13,826.39...361.63%...$35,000.00...$15,000.00 10/29/2008...$50,000.00...$12,757.89...391.91%...$35,000.00...$15,000.00 10/30/2008...$50,000.00...$12,771.02...391.51%...$35,000.00...$15,000.00 10/31/2008...$50,000.00...$13,851.48...360.97%...$35,000.00...$15,000.00 40

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 40 of 144 11/1/2008...$50,000.00....$13,851.48...360.97%...$35,000.00...$15,000.00 11/2/2008...$50,000.00....$13,851.48...360.97%...$35,000.00...$15,000.00 11/3/2008...$50,000.00....$13,829.87...361.54%...$35,000.00...$15,000.00 11/4/2008...$47,000.00....$14,586.19...322.22%...$35,000.00...$12,000.00 11/5/2008...$47,000.00....$12,922.28...363.71%...$35,000.00...$12,000.00 11/6/2008...$47,500.00....$11,625.73...408.58%...$47,500.00...$0.00...... $36,562.70 11/7/2008...$47,500.00....$12,036.31...394.64%...$47,500.00...$0.00 11/8/2008...$47,500.00....$12,036.31...394.64%...$47,500.00...$0.00 11/9/2008...$47,500.00....$12,036.31...394.64%...$47,500.00...$0.00 11/10/2008...$47,500.00...$11,841.83...401.12%...$47,500.00...$0.00 11/11/2008...$47,500.00...$11,993.09...396.06%...$47,500.00...$0.00 11/12/2008...$47,500.00...$11,171.94...425.17%...$47,500.00...$0.00 11/13/2008...$47,500.00...$12,187.57...389.74%...$47,500.00...$0.00 11/14/2008...$47,500.00...$11,863.43...400.39%...$47,500.00...$0.00 11/15/2008...$47,500.00...$11,863.43...400.39%...$47,500.00...$0.00 11/16/2008...$47,500.00...$11,863.43...400.39%...$47,500.00...$0.00 11/17/2008...$47,500.00...$11,388.03...417.10%...$47,500.00...$0.00 11/18/2008...$47,500.00...$11,366.42...417.90%...$47,500.00...$0.00 11/19/2008...$47,500.00....$9,875.39...480.99%...$47,500.00...$0.00 11/20/2008...$47,500.00....$8,859.76...536.13%...$47,500.00...$0.00...$47,212.70 11/21/2008...$47,500.00....$8,924.59...532.24%...$47,500.00...$0.00 11/22/2008...$47,500.00....$8,924.59...532.24%...$47,500.00...$0.00 11/23/2008...$47,500.00....$8,924.59...532.24%...$47,500.00...$0.00 11/24/2008...$47,500.00...$11,431.25...415.53%...$47,500.00...$0.00 11/25/2008...$47,500.00...$11,301.60...420.29%...$47,500.00...$0.00 11/26/2008...$47,500.00...$12,209.18...389.05%...$47,500.00...$0.00 11/27/2008...$47,500.00...$12,209.18...389.05%...$47,500.00...$0.00 11/28/2008...$47,500.00...$12,144.35...391.13%...$47,500.00...$0.00 11/29/2008...$47,500.00...$12,144.35...391.13%...$47,500.00...$0.00 11/30/2008...$47,500.00...$12,144.35...391.13%...$47,500.00...$0.00 12/1/2008....$47,500.00....$9,291.94...511.20%...$47,500.00...$0.00 12/2/2008...$47,500.00...$10,782.98...440.51%...$47,500.00...$0.00 12/3/2008...$47,500.00...$11,755.39...404.07%...$47,500.00...$0.00 12/4/2008...$45,000.00...$11,388.03...395.15%...$45,000.00...$0.00 12/5/2008...$45,000.00...$12,641.36...355.97%...$45,000.00...$0.00 12/6/2008...$45,000.00...$12,641.36...355.97%...$45,000.00...$0.00 12/7/2008...$45,000.00...$12,641.36...355.97%...$45,000.00...$0.00 12/8/2008...$45,000.00...$13,786.65...326.40%...$45,000.00...$0.00 12/9/2008...$45,000.00...$12,879.07...349.40%...$45,000.00...$0.00 12/10/2008...$45,000.00...$12,274.01...366.63%...$45,000.00...$0.00 12/11/2008...$45,000.00...$10,847.80...414.83%...$45,000.00...$0.00 12/12/2008...$45,000.00...$11,431.25...393.66%...$45,000.00...$0.00 12/13/2008...$45,000.00...$11,431.25...393.66%...$45,000.00...$0.00 41

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 41 of 144 12/14/2008...$45,000.00...$11,431.25...393.66%...$45,000.00...$0.00 12/15/2008...$45,000.00...$11,042.29...407.52%...$45,000.00...$0.00 12/16/2008...$45,000.00...$12,749.41...352.96%...$45,000.00...$0.00 12/17/2008...$45,000.00...$12,706.19...354.16%...$45,000.00...$0.00 12/18/2008...$30,000.00...$12,490.10...240.19%...$30,000.00...$0.00 12/19/2008...$30,000.00...$12,230.79...245.28%...$30,000.00...$0.00 12/20/2008...$30,000.00...$12,230.79...245.28%...$30,000.00...$0.00 12/21/2008...$30,000.00...$12,230.79...245.28%...$30,000.00...$0.00 12/22/2008...$40,000.00...$11,777.00...339.65%...$40,000.00...$0.00...$76,280.00 12/23/2008...$40,000.00...$11,452.86...349.26%...$40,000.00...$0.00 12/24/2008...$40,000.00...$11,885.04...336.56%...$40,000.00...$0.00 12/25/2008...$40,000.00...$11,885.04...336.56%...$40,000.00...$0.00 12/26/2008...$40,000.00...$11,777.00...339.65%...$40,000.00...$0.00 12/27/2008...$40,000.00...$11,777.00...339.65%...$40,000.00...$0.00 12/28/2008...$40,000.00...$11,777.00...339.65%...$40,000.00...$0.00 12/29/2008...$40,000.00...$11,798.61...339.02%...$40,000.00...$0.00 12/30/2008...$40,000.00...$12,382.05...323.05%...$40,000.00...$0.00 12/31/2008...$40,000.00...$11,971.48...334.13%...$40,000.00...$0.00 1/1/2009...... $40,000.00...$11,971.48...334.13%...$40,000.00...$0.00

DATE BALANCE = Total borrowings MKT CAP = Company total market capitalization % CAP = Total loan balances as a percent of market capitalization TAF = Term Auction Facility borrowings DW = Discount Window borrowings UC = Unencumbered Capital pledged as collateral http://www.federalreserve.gov/newsevents/reform_taf.htm http://www.bloomberg.com/news/2011-12-23/fed-s-once-secret-data-compiled-by- bloomberg-released-to-public.html

The Federal Reserve did not provide any emergency financial assistance in connection with the Wells Fargo-Wachovia merger.

...While emergency credit was not sought or given in connection with the Wachovia transaction, Wachovia's depository institutions accessed the Federal Reserve's discount window at various times throughout 2008.

Scott G. Alvarez General Counsel of the Federal Reserve

68. On 1/16/2008, Wachovia accessed the Fed's Discount Window for $1.235 billion, for one day according to Bloomberg News.

On 4/16/2008, Wachovia accessed the Fed's Discount Window for $1.225 billion, for one day according to Bloomberg News.

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 42 of 144 On 5/13/2008, Wachovia accessed the Fed's Discount Window for $1.775 billion, for one day according to Bloomberg News.

On 6/3/2008, Wachovia accessed the Fed's Discount Window for $0.675 billion, for one day according to Bloomberg News.

Wachovia accessed the Fed's Discount Window for $29 billion on 10/6/2008 for two days, which fell to $25 billion on 10/8/2008 through 10/22/2008, which fell to $15 billion through 11/3/2008 as TAF borrowings rose from $25 billion to $35 billion. Discount Window borrowings fell to $12 billion from 11/4/2008 to 11/5/2008 and Zero on 11/6/2008 as TAF borrowings rose from $35 billion to $47.5 billion.

69. On December 2, 2010, the Daily Mail reported "Federal Reserve reveals trillions dished out to world banks to aid financial crisis" which stated 'There's very much a sense from the data that the Federal Reserve was not just providing liquidity to U.S. banks but was creating stability for the entire world's financial system,' said Linus Wilson, assistant professor of finance at the University of Louisiana, who has studied the financial crisis." without any mention of the size of the credit lines provided by the Fed to Wells Fargo, Wachovia and other companies. http://www.dailymail.co.uk/news/article-1334929/Federal-Reserve-reveals-trillions-dished- world-banks-aid-financial-crisis.html#ixzz3KTQXKsmg

70. On May 26, 2011, Bloomberg's Bob Ivry, without any mention of the size any credit lines, wrote "Fed Gave Banks Crisis Gains on Secretive Loans Low as 0.01%" which stated "Credit Suisse Group AG (CS), Goldman Sachs Group Inc. (GS) and Royal Bank of Scotland Group Plc (RBS) each borrowed at least $30 billion in 2008 from a Federal Reserve emergency lending program whose details weren’t revealed to shareholders, members of Congress or the public.

The $80 billion initiative, called single-tranche open-market operations, or ST OMO, made 28-day loans from March through December 2008, a period in which confidence in global credit markets collapsed after the Sept. 15 bankruptcy of Lehman Brothers Holdings Inc.

Units of 20 banks were required to bid at auctions for the cash. They paid interest rates as low as 0.01 percent that December, when the Fed’s main lending facility charged 0.5 percent.

“This was a pure subsidy,” said Robert A. Eisenbeis, former head of research at the Federal Reserve Bank of Atlanta and now chief monetary economist at Sarasota, Florida-based Cumberland Advisors Inc. “The Fed hasn’t been forthcoming with disclosures overall. Why should this be any different?”

...Congress overlooked ST OMO when lawmakers required the central bank to publish its emergency lending data last year under the Dodd-Frank law.

“I wasn’t aware of this program until now,” said U.S. Representative Barney Frank, the Massachusetts Democrat who chaired the House Financial Services Committee in 2008 and co-authored the legislation overhauling financial regulation.

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 43 of 144 Records of the 2008 lending, released in March under court orders, show how the central bank adapted an existing tool for adjusting the U.S. money supply into an emergency source of cash. Zurich-based Credit Suisse borrowed as much as $45 billion, according to bar graphs that appear on 27 of 29,000 pages the central bank provided to media organizations that sued the Fed Board of Governors for public disclosure.

New York-based Goldman Sachs’s borrowing peaked at about $30 billion, the records show...

The records don’t provide exact loan amounts for each bank. Smith, the New York Fed spokesman, would not disclose those details. Amounts cited in this article are estimates based on the graphs. ...The Fed opposed disclosing details of its open market operations because doing so would probably cause borrowers “substantial competitive harm,” according to a March 2009 declaration by Christopher R. Burke, vice president of the New York Fed’s markets group. The declaration is filed in federal court.

Revealing the borrowing “could lead market participants to inaccurately speculate that the primary dealer was having difficulty finding term funding against its collateral in the open market and that the dealer itself must therefore be in financial trouble,” Burke said in opposing a media request for records about the borrowing.

...“At such low interest rates, it’s no longer a rescue, it’s a profit-making enterprise,” Greenberger said. “By December, a lot of money was made off this program.”

Goldman Sachs, led by Chief Executive Officer Lloyd C. Blankfein, tapped the program most in December 2008, when data on the New York Fed website show the loans were least expensive. The lowest winning bid at an ST OMO auction declined to 0.01 percent on Dec. 30, 2008, New York Fed data show. At the time, the rate charged at the discount window was 0.5 percent.

Stephen Cohen, a spokesman for Goldman Sachs, declined to comment.

...Using repos to provide emergency cash, a step the Fed announced on March 7, 2008, was a departure from that process, said John H. Cochrane, a finance professor at the University of Chicago Booth School of Business.

“The Fed was slamming the pedal to the metal in the lender-of-last-resort category,” Cochrane said. “What they did was so far from what we conventionally think of as monetary policy.”

...Frankfurt-based Deutsche Bank’s use peaked at about $20 billion in October 2008, its chart shows. The bank had 87 billion euros ($122 billion) in repurchase agreements with all central banks as of the end of 2008, according to its annual report. http://www.bloomberg.com/news/2011-05-26/fed-gave-banks-crisis-gains-on-secretive- loans-as-low-as-0-01-.html

71. On August 22, 2011, Bloomberg's Bradley Keoun and Phil Kuntz wrote "Wall Street Aristocracy Got $1.2 Trillion in Secret Loans" which only mentions collateral and securities 44

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 44 of 144 pledged for Morgan Stanley; "...Morgan Stanley borrowed $61.3 billion from one Fed program in September 2008, pledging a total of $66.5 billion of collateral, according to Fed documents. Securities pledged included $21.5 billion of stocks, $6.68 billion of bonds with a junk credit rating and $19.5 billion of assets with an “unknown rating,” according to the documents. About 25 percent of the collateral was foreign-denominated..."

...The loans dwarfed the $160 billion in public bailouts the top 10 got from the U.S. Treasury, yet until now the full amounts have remained secret. ...according to a Bloomberg News compilation of data obtained through Freedom of Information Act requests, months of litigation and an act of Congress.

...It wasn’t just American finance. Almost half of the Fed’s top 30 borrowers, measured by peak balances, were European firms.

...The $1.2 trillion peak on Dec. 5, 2008 -- the combined outstanding balance under the seven programs tallied by Bloomberg -- was almost three times the size of the U.S. federal budget deficit that year and more than the total earnings of all federally insured banks in the U.S. for the decade through 2010, according to data compiled by Bloomberg.

...Fed officials argued for more than two years that releasing the identities of borrowers and the terms of their loans would stigmatize banks, damaging stock prices or leading to depositor runs. A group of the biggest commercial banks last year asked the U.S. Supreme Court to keep at least some Fed borrowings secret. In March, the high court declined to hear that appeal, and the central bank made an unprecedented release of records.

Data gleaned from 29,346 pages of documents obtained under the Freedom of Information Act and from other Fed databases of more than 21,000 transactions make clear for the first time how deeply the world’s largest banks depended on the U.S. central bank to stave off cash shortfalls. Even as the firms asserted in news releases or earnings calls that they had ample cash, they drew Fed funding in secret, avoiding the stigma of weakness.

...In most cases, the Fed demanded collateral for its loans -- Treasuries or corporate bonds and mortgage bonds that could be seized and sold if the money wasn’t repaid.

...As the crisis deepened, the Fed relaxed its standards for acceptable collateral. Typically, the central bank accepts only bonds with the highest credit grades, such as U.S. Treasuries. By late 2008, it was accepting “junk” bonds, those rated below investment grade. It even took stocks, which are first to get wiped out in a liquidation.

...While the Fed’s last-resort lending programs generally charge above-market interest rates to deter routine borrowing, that practice sometimes flipped during the crisis. On Oct. 20, 2008, for example, the central bank agreed to make $113.3 billion of 28-day loans through its Term Auction Facility at a rate of 1.1 percent, according to a press release at the time.

The rate was less than a third of the 3.8 percent that banks were charging each other to make one-month loans on that day. Bank of America and Wachovia Corp. each got $15 billion of the 1.1 percent TAF loans...

The Fed’s liquidity lifelines may increase the chances that banks engage in excessive risk- taking with borrowed money, Rogoff said. Such a phenomenon, known as moral hazard, 45

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 45 of 144 occurs if banks assume the Fed will be there when they need it, he said. The size of bank borrowings “certainly shows the Fed bailout was in many ways much larger than TARP,” Rogoff said.

...In December, in response to the Dodd-Frank Act, the Fed released 18 databases detailing its temporary emergency-lending programs.

Congress required the disclosure after the Fed rejected requests in 2008 from the late Bloomberg News reporter Mark Pittman and other media companies that sought details of its loans under the Freedom of Information Act. After fighting to keep the data secret, the central bank released unprecedented information about its discount window and other programs under court order in March 2011.

...Banks also shifted balances among Fed programs. Many preferred the TAF because it carried less of the stigma associated with the discount window, often seen as the last resort for lenders in distress, according to a January 2011 paper by researchers at the New York Fed." http://www.bloomberg.com/news/2011-08-21/wall-street-aristocracy-got-1-2-trillion-in-fed- s-secret-loans.html http://www.bloomberg.com/data-visualization/federal-reserve-emergency-lending/

72. On November 27, 2011, Bloomberg's Bob Ivry, Bradley Keoun and Phil Kuntz, who chose to only disclose Morgan Stanley's Fed credit line and didn't say whether the non- disclosures were illegal, wrote "Secret Fed Loans Gave Banks $13 Billion Undisclosed to Congress" which stated;

"The Federal Reserve and the big banks fought for more than two years to keep details of the largest bailout in U.S. history a secret. Now, the rest of the world can see what it was missing.

The Fed didn’t tell anyone which banks were in trouble so deep they required a combined $1.2 trillion on Dec. 5, 2008, their single neediest day. Bankers didn’t mention that they took tens of billions of dollars in emergency loans at the same time they were assuring investors their firms were healthy. And no one calculated until now that banks reaped an estimated $13 billion of income by taking advantage of the Fed’s below-market rates...

Saved by the bailout, bankers lobbied against government regulations, a job made easier by the Fed, which never disclosed the details of the rescue to lawmakers even as Congress doled out more money and debated new rules aimed at preventing the next collapse.

A fresh narrative of the financial crisis of 2007 to 2009 emerges from 29,000 pages of Fed documents obtained under the Freedom of Information Act and central bank records of more than 21,000 transactions. ...details suggest taxpayers paid a price beyond dollars as the secret funding helped preserve a broken status quo and enabled the biggest banks to grow even bigger.

...“When you see the dollars the banks got, it’s hard to make the case these were successful institutions,” says Sherrod Brown, a Democratic Senator from Ohio who in 2010 introduced 46

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 46 of 144 an unsuccessful bill to limit bank size. “...There are lawmakers in both parties who would change their votes now.”

The size of the bailout came to light after Bloomberg LP, the parent of Bloomberg News, won a court case against the Fed and a group of the biggest U.S. banks called Clearing House Association LLC to force lending details into the open.

...Clearing House Association fought Bloomberg’s lawsuit up to the U.S. Supreme Court, which declined to hear the banks’ appeal in March 2011.

The amount of money the central bank parceled out was surprising even to Gary H. Stern, president of the Federal Reserve Bank of Minneapolis from 1985 to 2009, who says he “wasn’t aware of the magnitude.” It dwarfed the Treasury Department’s better-known $700 billion Troubled Asset Relief Program, or TARP...

“TARP at least had some strings attached,” says Brad Miller, a North Carolina Democrat on the House Financial Services Committee, referring to the program’s executive-pay ceiling. “With the Fed programs, there was nothing.”

Bankers didn’t disclose the extent of their borrowing. On Nov. 26, 2008, then-Bank of America (BAC) Corp. Chief Executive Officer Kenneth D. Lewis wrote to shareholders that he headed “one of the strongest and most stable major banks in the world.” He didn’t say that his Charlotte, North Carolina-based firm owed the central bank $86 billion that day.

JPMorgan Chase & Co. CEO Jamie Dimon ...didn’t say that the New York-based bank’s total TAF borrowings were almost twice its cash holdings or that its peak borrowing of $48 billion on Feb. 26, 2009, came more than a year after the program’s creation.

...The Fed has said that all loans were backed by appropriate collateral. That the central bank didn’t lose money should “lead to praise of the Fed, that they took this extraordinary step and they got it right,” says Phillip Swagel, a former assistant Treasury secretary under Henry M. Paulson...

The Fed initially released lending data in aggregate form only. Information on which banks borrowed, when, how much and at what interest rate was kept from public view.

The secrecy extended even to members of President George W. Bush’s administration who managed TARP....

...JPMorgan, Bank of America, Citigroup Inc. (C), Wells Fargo & Co. (WFC), Goldman Sachs Group Inc. (GS) and Morgan Stanley -- accounted for 63 percent of the average daily debt to the Fed by all publicly traded U.S. banks, money managers and investment- services firms, the data show.

...Bernanke in an April 2009 speech said that the Fed provided emergency loans only to “sound institutions,” even though its internal assessments described at least one of the biggest borrowers, Citigroup, as “marginal.”

On Jan. 14, 2009, six days before the company’s central bank loans peaked, the New York Fed gave CEO Vikram Pandit a report declaring Citigroup’s financial strength to be “superficial,” bolstered largely by its $45 billion of Treasury funds.

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 47 of 144 ...Judd Gregg, a former New Hampshire senator who was a lead Republican negotiator on TARP, and Barney Frank, a Massachusetts Democrat who chaired the House Financial Services Committee, both say they were kept in the dark.

“We didn’t know the specifics,” says Gregg, who’s now an adviser to Goldman Sachs.

“We were aware emergency efforts were going on,” Frank says. “We didn’t know the specifics.”

...Congress debated that legislation in 2010 without a full understanding of how deeply the banks had depended on the Fed for survival.

It would have been “totally appropriate” to disclose the lending data by mid-2009, says David Jones, a former economist at the Federal Reserve Bank of New York who has written four books about the central bank.

“The Fed is the second-most-important appointed body in the U.S., next to the Supreme Court, and we’re dealing with a democracy,” Jones says. “Our representatives in Congress deserve to have this kind of information so they can oversee the Fed.”

...Lawmakers knew none of this. They had no clue that one bank, New York-based Morgan Stanley (MS), took $107 billion in Fed loans in September 2008, enough to pay off one- tenth of the country’s delinquent mortgages. The firm’s peak borrowing occurred the same day Congress rejected the proposed TARP bill, triggering the biggest point drop ever in the Dow Jones Industrial Average. (INDU) The bill later passed, and Morgan Stanley got $10 billion of TARP funds, though Paulson said only “healthy institutions” were eligible.

Mark Lake, a spokesman for Morgan Stanley, declined to comment, as did spokesmen for Citigroup and Goldman Sachs.

...Byron L. Dorgan, a former Democratic senator from North Dakota, says the knowledge might have helped pass legislation to reinstate the Glass-Steagall Act, which for most of the last century separated customer deposits from the riskier practices of investment banking.

“Had people known about the hundreds of billions in loans to the biggest financial institutions, they would have demanded Congress take much more courageous actions to stop the practices that caused this near financial collapse,” says Dorgan, who retired in January.

...Total assets held by the six biggest U.S. banks increased 39 percent to $9.5 trillion on Sept. 30, 2011, from $6.8 trillion on the same day in 2006, according to Fed data.

...Employees at the six biggest banks made twice the average for all U.S. workers in 2010, based on Bureau of Labor Statistics hourly compensation cost data. The banks spent $146.3 billion on compensation in 2010, or an average of $126,342 per worker, according to data compiled by Bloomberg. That’s up almost 20 percent from five years earlier compared with less than 15 percent for the average worker. Average pay at the banks in 2010 was about the same as in 2007, before the bailouts.

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 48 of 144 ...“The pay levels came back so fast at some of these firms that it appeared they really wanted to pretend they hadn’t been bailed out,” says Anil Kashyap, a former Fed economist who’s now a professor of economics at the University of Chicago Booth School of Business.

...Wells Fargo bought Wachovia Corp., the fourth-largest U.S. bank by deposits before the 2008 acquisition. Because depositors were pulling their money from Wachovia, the Fed channeled $50 billion in secret loans to the Charlotte, North Carolina-based bank through two emergency-financing programs to prevent collapse before Wells Fargo could complete the purchase.

“These programs proved to be very successful at providing financial markets the additional liquidity and confidence they needed at a time of unprecedented uncertainty,” says Ancel Martinez, a spokesman for Wells Fargo.

...Lobbying expenditures by the six banks that would have been affected by the legislation rose to $29.4 million in 2010 compared with $22.1 million in 2006, the last full year before credit markets seized up -- a gain of 33 percent, according to OpenSecrets.org, a research group that tracks money in U.S. politics. Lobbying by the American Bankers Association, a trade organization, increased at about the same rate, OpenSecrets.org reported.

Lobbyists argued the virtues of bigger banks. They’re more stable, better able to serve large companies and more competitive internationally, and breaking them up would cost jobs and cause “long-term damage to the U.S. economy,” according to a Nov. 13, 2009, letter to members of Congress from the FSF.

...Top officials in President Barack Obama’s administration sided with the FSF in arguing against legislative curbs on the size of banks.

Geithner, Kaufman

On May 4, 2010, Geithner visited [former Democratic Senator Ted] Kaufman in his Capitol Hill office. As president of the New York Fed in 2007 and 2008, Geithner helped design and run the central bank’s lending programs. The New York Fed supervised four of the six biggest U.S. banks and, during the credit crunch, put together a daily confidential report on Wall Street’s financial condition. Geithner was copied on these reports, based on a sampling of e-mails released by the Financial Crisis Inquiry Commission.

At the meeting with Kaufman, Geithner argued that the issue of limiting bank size was too complex for Congress and that people who know the markets should handle these decisions, Kaufman says....

Anthony Coley, a spokesman for Geithner, declined to comment.

...Dean Baker, co-director of the Center for Economic and Policy Research in Washington, says banks “were either in bad shape or taking advantage of the Fed giving them a good deal. The former contradicts their public statements. The latter -- getting loans at below- market rates during a financial crisis -- is quite a gift.”

The Fed says it typically makes emergency loans more expensive than those available in the marketplace to discourage banks from abusing the privilege. During the crisis, Fed loans were among the cheapest around, with funding available for as low as 0.01 percent in 49

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 49 of 144 December 2008, according to data from the central bank and money-market rates tracked by Bloomberg.

The Fed funds also benefited firms by allowing them to avoid selling assets to pay investors and depositors who pulled their money. So the assets stayed on the banks’ books, earning interest.

Banks report the difference between what they earn on loans and investments and their borrowing expenses. The figure, known as net interest margin, provides a clue to how much profit the firms turned on their Fed loans, the costs of which were included in those expenses. To calculate how much banks stood to make, Bloomberg multiplied their tax- adjusted net interest margins by their average Fed debt during reporting periods in which they took emergency loans.

...The six biggest U.S. banks’ share of the estimated subsidy was $4.8 billion, or 23 percent of their combined net income during the time they were borrowing from the Fed.

...“The net interest margin is an effective way of getting at the benefits that these large banks received from the Fed,” says Gerald A. Hanweck, a former Fed economist who’s now a finance professor at George Mason University in Fairfax, Virginia... http://www.bloomberg.com/news/2011-11-28/secret-fed-loans-undisclosed-to-congress- gave-banks-13-billion-in-income.html

73. After reviewing a Bloomberg investigative news report identifying Wachovia and Wells Fargo as a beneficiaries of undisclosed Federal Reserve loans, I filed a confidential complaint through Wells Fargo’s internal ethics line on November 29, 2014, before the inquiry and reply described in item 62. I provided an external email address and phone number to Wells Fargo's confidential ethics hot line, after which I was contacted on multiple occasions by investigators on my monitored company email and phone.

74. Plaintiff's 11/29/2014 Ethics Line submission #115936586 summarized as "Accounting Irregularities" stated;

"The Audit and Examination Committee of the ...Board of Directors will oversee the investigation of concerns raised about accounting, internal accounting controls, and auditing matters. [and] ...a team member may not: Purchase or sell securities...if he or she has 50

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 50 of 144 material inside information. [and] Gaming is defined as the manipulation, misrepresentation, or both of ...reporting in an attempt to receive compensation."

75. Plaintiff's 12/02/2011 filed Ethics Line report #115950526 summarized as "Falsification of Company Records" stated;

“Sarbanes–Oxley Act, Title III ...mandates that senior executives take individual responsibility for the accuracy and completeness of corporate financial reports. It ...specifies the responsibility of corporate officers for the accuracy and validity of corporate financial reports.

...Section 302 requires that the company's "principal officers" (typically the Chief Executive Officer and Chief Financial Officer) certify and approve the integrity of their company financial reports quarterly. ...The CEO and CFO are now required to unequivocally take ownership for their financial statements under Section 302…

Title IV ...requires timely reporting of material changes in financial condition... Sarbanes- Oxley required the disclosure of all material off-balance sheet items.”

Wikipedia

76. Plaintiff's 12/03/2011 filed Ethics Line report #115955622 summarized as "Auditing Irregularities" stated;

"You are responsible for preparing and maintaining accurate records to the best of your knowledge ...in compliance with applicable regulations, law and Wells Fargo's record retention policies. All business transactions ...must be properly and accurately recorded ...in accordance with applicable accounting standards, legal requirements, and Wells Fargo's system of internal controls. Falsification of any company...information is prohibited. Falsification refers to knowingly misstating, altering, adding information to, or omitting or deleting information from a Wells Fargo record or system which results in something that is untrue, fraudulent or misleading."

Wells Fargo’s Code of Ethics and Business Conduct

77. The following emails came and went from my monitored business email address;

From: Mixdorf, Brian M. Sent: Monday, December 05, 2011 11:07 AM To: Hartzman, George Subject: Ethics Line Call

Hello George,

I am the Investigator assigned to your ethics line complaint.

Brian Mixdorf, CFE, CFS Senior Investigative Agent, VP Wells Fargo Corporate Investigations . From: Mixdorf, Brian M. Sent: Monday, December 05, 2011 12:19 PM To: Hartzman, George Subject: RE: Ethics Line Call

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 51 of 144 To clarify George, Attending the call will be the two of us, in addition to Carolyn Harris with Human Resources.

We are receiving all of your ethics concerns, and are willing to openly discuss them at that time.

…Thanks again,

Brian

78. On 12/8/2011, Brian Mixdorf, CFE, CFS, Senior Investigative Agent, VP, Wells Fargo Corporate Investigations, spoke with Plaintiff concerning his Ethics Line submittals for about 30 minutes, much of which concerned Wells Fargo's violation of Plaintiff's confidentiality, and Ken Tolson indicated Brian Mixdorf was going to contact Plaintiff's manager, which was another violation of confidentiality;

"12/8/2011...... Notes below written by ERC Ken Tolson

Re: George Hartzman

Per Brian Mixdorf and Carolyn Harris

Per Brian, he is investigating this issue and will also make his manager aware.

...He spent most of [the interview] saying he was concerned he would be fired because [he] ratted out the bank leaders on this issue. Carolyn said she explained that ethics line complaints are confidential...

He stated that others could be watching communication on email and this concerned him."

79. ER Case #2162011 Case Notes [permitted to be disclosed without being sealed by Defendant state;]

Background Notification

11.30.11 JEvans: K.Hall emailed this report to M.Bacon on 11.29.11 for review.

12/1/11 DMelonson: K. Hall sent email from M. Bacon requesting this report to remain pending until CI can assess the situation by calling the report submitter...

12/5/11 DMelanson: Per M Bacon, assigning to CI-WBR - B Mixdorf. This report is related to EL reports #115950526 and 115955622.

Allegation/Issue

Wells Fargo Advisor (WFA) Financial Advisor (FA) George Hartzman made an accusation that Wells Fargo and executive management violated the law and the company code of ethics by accepting government TARP money.

Action Taken

...12/08/11 (BM) On this date, SA Brian Mixdorf spoke to FA George Hartzman regarding his ethical concerns regarding Wells Fargo. Human Resources Manager Carolyn Harris was also on the telephone as a witness.

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 52 of 144 On the call, FA Hartzman expressed a ethical concern that Wells Fargo violated the law and WF code of ethics by accepting money for the bail out. He stated that WF did not include this in their financial statements thus misleading share holders

Hartzman spoke of "secret loans: between the government and WF, and a conspiracy.

12/9/11 (BM) Email was sent to Redacted per Michael Bacon request.

80. On 12/9/2014, in the Privilege Log permitted to be disclosed without being sealed by Defendant, under "Privilege Type" and "Attorney-Client Privilege; Attorney-Work Product" is described as "E-mail/invite re: Ethics line case; with handwritten notes and regarding Jim Strother" and "E-mail Sent To" "Brian Mixdorf, Bob C. Moseley, Ken Tolson and Craig Mills" and "E-mail From" "Carolyn Harris".

Item 32 of this filing states "On October 31, 2008, WELLS FARGO & COMPANY FORM S-4 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933, which prominently listed James M. Strother, Esq., Executive Vice President and General Counsel of Wells Fargo".

On 1/4/2014, in the Privilege Log permitted to be disclosed without being sealed by Defendant, under "Privilege Type" and "Attorney-Client Privilege; Attorney-Work Product" is described as "Handwritten notes and re: George Hartzman, per Brian Mixdorf and regarding Jim Strother".

81. The Case Summary form, permitted to be disclosed without being sealed by Defendant states "User Override by Brian Mixdorf on 12/08/2011. Pot. Loss: $0.00. Reason: Ethics Line concern, but no COE or criminal violations" on a Wells Fargo Investigations Internal Investigations Case Summary Form.

82. From: Hartzman, George Sent: Thursday, December 08, 2011 10:05 AM To: Mixdorf, Brian M. Subject: RE: Ethics Line Call

Per the ACFE website, the code of ethics states that a Certified Fraud Examiner shall: Demonstrate a commitment to professionalism and diligence in his or her duties. Not engage in any illegal or unethical conduct, or any activity which constitutes a conflict of interest.

...accept only assignments for which there is reasonable expectation that the assignment will be completed with professional competence.

...testify to matters truthfully and without bias or prejudice.

Obtain evidence or other documentation to establish a reasonable basis for any opinion rendered. ...Not reveal any confidential information without proper authorization.

Reveal all pertinent material matters discovered during the course of an examination.

83. From Moseley, Bob C Sent: Friday, December 09, 2011 3:22 PM To: Mills, Craig (EAC) Cc: Ward, Sharon S. (EAC); Harris, Carolyn F Subject: review of GH website.

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 53 of 144 Possible trigger for ethics call 10/21/11 referencing TARP and "undisclosed loans from Fed" costing him $20,000.00

84. After no more than a 30 minute interview with Brian on December 8, 2011, I contacted Mr. Mixdorf concerning the fact that my confidentiality had been compromised;

From: Hartzman, George Sent: Monday, December 19, 2011 10:16 AM To: Mixdorf, Brian M. Subject: On who reads our emails

Apparently someone named Laurie Rose reads our internal emails.

Therefore, how is sending an email not a way to stay anonymous? . From: Mixdorf, Brian M. Sent: Monday, December 19, 2011 10:23 AM To: Hartzman, George Subject: RE: On who reads our emails

Thank you for the information. I do not know this person, but will follow up on your concern. Have a great day. . 85. From investigation notes provided by Defendant; "On 12/19/2011, "Brian Mixdorf spoke with Laurie Rose. Rose stated that they review emails routinely, for performance issues. Rose stated that she did not recall the name. Rose was instructed to keep any ethical complaints confidential, and to not forward them. Rose agreed...

This matter was reviewed, and the allegations that WF broke the law remain unfounded. Case closed, and no further action is required. No Loss.

...there is no reason to believe that WF violated any laws. HR, ER, Physical Security and EAC was contacted."

86. On December 21, 2011, Wells Fargo Executive Vice President and Controller Richard D. Levy responded to an inquiry by the SEC's Stephanie L. Hunsaker "In response to the comments by the staff (“Staff”) of the Securities and Exchange Commission (“Commission”) contained in the Staff’s letter dated December 13, 2011, to Wells Fargo & Company (“Wells Fargo,” “Company,” “we,” or “our”), we submit the following information. The Staff’s comments, indicated in bold, are followed by Wells Fargo’s responses."; [Hartzman underline]

We have become aware through various news reports that you may have accessed various Federal Reserve and Federal Deposit Insurance Corporation sponsored funding programs during 2008 and 2009, including the Term Auction Facility (TAF)... We note from your disclosures during these periods that you appear to disclose the participation in the TLGP, along with the amounts of borrowing outstanding as of the balance sheet dates for this program, but you do not appear to have provided any discussion about certain other programs that were in existence at this time, such as the TAF, CPFF, PDCF and TSLF. To the extent that you had borrowings under any of these programs during those periods, please tell us how you concluded that quantitative and qualitative disclosure about your participation in these programs was not required. Additionally, please provide your analysis as to whether you believe that 54

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 54 of 144 any participation in these programs constituted a form of federal financial assistance, such that additional disclosure may have been required as to the effects of this assistance on your financial condition and results of operations pursuant to the guidance in FRC 501.06.c. Effects of Federal Financial Assistance Upon Operations.

Wells Fargo response: [Hartzman emphasis in bold and underline]

Wells Fargo did not participate in the Commercial Paper Funding Facility (CPFF), Primary Dealer Credit Facility (PDCF) or Term Securities Lending Facility (TSLF). Moreover, we did not participate in the Term Asset-Backed Securities Loan Facility (TALF), nor did we access the Federal Reserve’s discount window for liquidity purposes during 2008 and 2009. We did participate in the Term Auction Facility (TAF) during 2008 through August 2009. TAF was established by the Federal Reserve in December 2007, and represented one of several sources of competitive, low-cost short term funding available to us. TAF involved market pricing based on auctions conducted by the Federal Reserve that included multiple market participants. At December 31, 2008, our short-term borrowings under TAF totaled $72.5 billion, which included $40 billion of TAF borrowings by Wachovia Corporation at the time of acquisition. However, the TAF borrowings were classified differently in the legacy Wells Fargo and Wachovia accounting systems (which had not been integrated as of the time the 2008 Form 10-K was prepared), which resulted in our reporting of $32.5 billion of the TAF borrowings in the “Commercial paper and other short-term borrowings” line item, and the $40 billion of Wachovia TAF borrowings reported in the “Federal funds purchased and securities sold under agreements to repurchase” line item of Note 13 (Short-Term Borrowings) in our 2008 Form 10-K. Despite the accounting systems difference, our management did not distinguish TAF from other sources of short-term borrowings, such as federal funds purchased, commercial paper or securities sold under repurchase agreements, because TAF represented one of the various similar sources of short-term market-based funding at the time. We ceased participating in TAF in August 2009 due to our post merger increase in deposit balances and overall reduction in short term borrowings.

If they can get you asking the wrong questions, they don't have to worry about answers.

Thomas Pynchon

We believe FRC 501.06.c does not apply to us because we have not entered into any federally assisted acquisitions or restructurings; in fact, our acquisition of Wachovia was specifically structured not to receive federal financial assistance. In addition, we do not believe that participation in the referenced programs constituted a form of federal financial assistance within the scope of FRC 501.06.c. Our participation in these federal programs was not “intended to make the surviving financial institution a viable entity.” We were a viable entity regardless of whether we participated in the programs. Further, our participation in the programs did not have the characteristics of the examples in FRC 501.06.c, as participation did not provide: yield maintenance assistance; indemnification against certain loss contingencies; the purchase of equity securities for cash 55

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 55 of 144 or a note from a federal agency; or arrangements designed to insulate us from the economic effects of problem assets. Regardless of our belief that participation in the referenced programs did not constitute a form of federal financial assistance, our participation in the referenced programs did not materially affect, and was not reasonably likely to have a material future effect upon our financial condition or results of operations. Therefore, FRC 501.06.c did not require us to make any additional disclosure as to the effects of this participation on our financial condition and results of operations...

The Company acknowledges that: the Company is responsible for the adequacy and accuracy of the disclosure in the filing;

Staff comments or changes to disclosure in response to Staff comments do not foreclose the Commission from taking any action with respect to the filing; and the Company may not assert Staff comments as a defense in any proceeding initiated by the Commission or any person under the federal securities laws of the United States...

Very truly yours,

/s/ RICHARD D. LEVY Richard D. Levy Executive Vice President and Controller (Principal Accounting Officer) cc: John G. Stumpf, Chairman, President and Chief Executive Officer Timothy J. Sloan, Senior Executive Vice President and Chief Financial Officer http://www.sec.gov/Archives/edgar/data/72971/000119312511349117/filename1.htm

87. Brian Mixdorf didn't reply until Plaintiff sent another email on January 4;

From: Hartzman, George Sent: Wednesday, January 04, 2012 9:40 AM To: Mixdorf, Brian M. Subject: RE: On who reads our emails

Please provide an update. G

88. Brian Mixdorf appears to have misled Plaintiff about Mixdorf's interview with Laurie Rose, and misled Plaintiff about confidentiality concerning other Wells Fargo employees, especially William Spivey, who was aware of the situation before Plaintiff informed Mr. Spivey, meaning Plaintiff's confidentiality was violated at least twice;

From: Mixdorf, Brian M. Sent: Wednesday, January 4, 2012 10:20 AM To: Harris, Carolyn F; Spivey, William Subject: FW: On who reads our emails

Please do not share. . From: Mixdorf, Brian M. Sent: Wednesday, January 04, 2012 10:47 AM To: Hartzman

Subject: RE: On who reads our emails

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 56 of 144 I am aware of no one reading emails. Please confer with your manager if you feel the need, but our case is closed.

Brian Mixdorf, CFE, CFS Senior Investigative Agent, VP, Wells Fargo Corporate Investigations New Ulm, MN . From: Hartzman, George To: Mixdorf, Brian M. Subject: On who reads our emails

What do you mean by "case closed"?

George Hartzman . From: Hartzman, George Sent: Wednesday, January 04, 2012 10:55 AM To: Spivey, William Cc: Eason, Janet Subject: FYI

I sent this to the ethics line at the beginning of December, talked to an investigator named Brian Mixdorf and have heard nothing back since. gh... . From: Spivey, William Sent: Wednesday, January 04, 2012 10:58 AM To: Hartzman, George Cc: Eason, Janet Subject: RE: FYI

What exactly are you stating, or asking, or expecting???

From: Eason, Janet Sent: Wednesday, January 04, 2012 10:58 AM

To Mixdorf, Brian M. Subject: FW: FYI

Hi Brian, Unfortunately, I had already sent this email to George / Bill Spivey earlier. J

Janet A. Eason Vice President, Market Compliance Specialist Central NC Market . From: Eason, Janet Sent: Wednesday, January 04, 2012 11:03 AM To: Hartzman, George; Spivey, William Subject: RE FYI

George, I'm almost positive you will not receive any type of response about this. The way I understand it, these concerns are reviewed and escalated to the proper sources if needed. You're out of it now. J

Janet A. Eason

89. Law360 reported "Halliburton Can't Reverse SOX Retaliation Ruling: 5th Circ." on November 12, 2014, which stated;

"A Fifth Circuit panel on Wednesday denied Halliburton Inc.’s attempt to overturn a U.S. Department of Labor finding that it retaliated against a whistleblower by

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 57 of 144 revealing his name in a document preservation notice, ruling an administrative board did not ignore Sarbanes-Oxley Act precedent.

Former Halliburton employee Anthony Menendez complained to both the U.S. Securities and Exchange Commission and Halliburton’s board about the company’s accounting practices. Halliburton’s general counsel, having seen Menendez’s internal complaint, assumed that an SEC notice about its inquiry was tied to Menendez...

...Halliburton retaliated against a whistleblower by outing him to his colleagues, an appeals court upheld in a Wednesday ruling.

The Fifth Circuit Court of Appeals affirmed a U.S. Department of Labor Administrative Review Board ruling that found the firm retaliated against former staffer Anthony Menendez by disclosing his identity to his colleagues, which led to them ostracizing him.

Mr. Menendez in 2005 raised concerns internally about some of Halliburton’s accounting practices. Later that year, he submitted a confidential complaint with the Securities and Exchange Commission over the same concerns, according to the order.

When the Securities and Exchange Commission told Halliburton it was investigating allegedly improper accounting practices in 2006, Bert Cornelison, the general counsel at the time, sent Mr. Menendez’ colleagues an e-mail that identified him as the whistleblower behind the agency’s probe, the order said. Colleagues then started to avoid Mr. Menendez and treat him differently.

Later that year, the SEC closed its investigation without taking action.

The Administrative Review Board said the company’s conduct constituted illegal retaliation under the 2002 Sarbanes-Oxley Act, which prohibits retaliation against staffers that report certain kinds of suspected wrongdoing. http://www.law360.com/articles/595565/halliburton-can-t-reverse-sox-retaliation-ruling-5th- circ-

90. After Janet Eason's email on January 4, I received the following from Ken Tolson;

George,

I work in WBR Employee Relations and support your region. I was made aware that you had raised a concern via the Ethics Line and that Compliance (Brian Mixdorf) was investigating your concerns. I am responding to your question that you emailed to Brian regarding your case being closed.

Thank you for raising these concerns. They have been investigated and will be addressed. It is our practice not to share the outcome of investigations. However, you can rest assured your concerns have been taken seriously, investigated and will be addressed. It is also consistent practice once an investigation is completed to say the issue has been closed. It is my understanding that is what Brian was communicating to you. Therefore, unless there is something new that needs to be looked into, there will be no further communication from Brian or myself.

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 58 of 144 Thank you again. Sincerely, Ken

Ken Tolson, SPHR Employee Relations Consultant Wells Fargo Wealth, Brokerage & Retirement I Employee Relations 1525 West W.T. Harris Blvd I CIC I MAC D1114-026 I Charlotte NC 28288

91. I replied with questions, which Tolson replied with;

From: Tolson, Ken Sent: Thursday, January 05, 2012 9:10 AM To: Hartzman, George Cc: Mixdorf, Brian M.; Spivey, William; Eason, Janet Subject: RE: Ethics Line Issue

Answers to your questions are below.

Ken Tolson, SPHR Employee Relations Consultant

Tolson; "...I am responding to your question that you emailed to Brian regarding your case being closed. They have been investigated and will be addressed." . GH; What are the results of the investigation and how will the issue be addressed? . Tolson; “George, as we have shared with you previously, we do not share the results or how it will be addressed. ...you can rest assured your concerns have been taken seriously, investigated and will be addressed. " . GH; What am I supposed to tell my clients? . Tolson; “This is something you should discuss with your manager. It is also consistent practice once an investigation is completed to say the issue has been closed."

GH; If the investigation is complete, where is the report? . Tolson; “As I stated in the answer to your first question, we do not share the results or any report.”

Tolson; "...unless there is something new that needs to be looked into, there will be no further communication from Brian or myself. " . GH; If my job is to act in the best interests of my clients, and a question of the best interests of my clients has been questioned, how should I respond to what some may consider to be an obfuscational response? . "...The Audit and Examination Committee of the Wells Fargo & Company Board of Directors will oversee the investigation of concerns raised about accounting, internal accounting controls, and auditing matters."

Wells Fargo’s Code of Ethics and Business Conduct . 59

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 59 of 144 GH; Did the Board of Directors oversee the investigation? . “Sarbanes–Oxley Act...

GH; Were the reports accurate? Was this information disclosed?

http://www.bloomberg.com/data-visualization/federal-reserve-emergency- lending/#/compare/?comparelist=Wachovia_Corp-Wells_Fargo_%2526_Co . “...Wells Fargo bought Wachovia Corp., ...because depositors were pulling their money from Wachovia, the Fed channeled $50 billion in secret loans…through two emergency- financing programs to prevent collapse before Wells Fargo could complete the purchase.”

Bloomberg . GH; Is this correct?

“Falsification of any company or personal information that you provide is prohibited. Falsification refers to knowingly misstating, altering, adding information to, or omitting or deleting information from a Wells Fargo record or system which results in something that is untrue, fraudulent, or misleading.”

Wells Fargo’s Code of Ethics and Business Conduct . GH; If some misled, or omitted… How can the case be closed? . “It is the responsibility of all team members to raise concerns about behavior that may violate the Code or any laws, rules, or regulations.”

Wells Fargo’s Code of Ethics and Business Conduct

GH; If it is my responsibility to raise concerns and nothing happens, what is my responsibility to whom after? Is this a usual response for those who stick their necks 60

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 60 of 144 out? Should one who raises concerns be informed of the investigative outcome? . “...No retaliation may be taken..."

Wells Fargo’s Code of Ethics and Business Conduct . From: Hartzman, George Sent: Thursday, January 05, 2012 10:55 AM To: Tolson, Ken Cc: Mixdorf, Brian M.; Spivey, William; Eason, Janet

Subject: RE: Ethics Line Issue

GH; As a Fiduciary, how should I respond? . Tolson; "we do not share the results or how it will be addressed." . “What Does It Mean to Be a Fiduciary?

Fiduciary duty represents the highest degree of trust and confidence that the investment advisor will act in your best interest.” . GH; Please explain how I am acting in my clients best interests if I accept your answer and do nothing more? . “Investment Advisors are governed by the Investment Advisers Act of 1940 and applicable state securities laws, which govern conduct and disclosure requirements, creating a high legal standard referred to as “fiduciary” duty.”

Breach of Fiduciary Duty

“When brokers agree to manage clients assets and/or obtain permission to place orders on their behalf, the brokers have additional fiduciary duties to these clients. ...when brokerage firms handle client accounts in fee-based “wrap accounts” they are subject to the Federal

Investment Advisors Act of 1940. This Act places a fiduciary duty on investment advisors... And; “As a fiduciary, your investment advisor has the duty to: Make full and fair disclosure of all material facts, particularly where the advisor’s interests may conflict with the client’s.” . GH; How can I disclose "all material facts" if I am not informed of what they are?

“Have a reasonable, independent basis for their investment advice” . GH; I thought I had a "reasonable, independent basis for their investment advice", until it was reported that I may not have had, which creates a conflict of interest which I have not been given a way to deal with if I don't know what I should?

“Be loyal to clients

An advisor will be measured against a higher standard of conduct than a broker... . GH; As a Fundamental Choice Portfolio Manager, do I not have a fiduciary obligation to my clients?... . "Federal and state law requires that Registered Investment Advisors are held to a Fiduciary Standard. This law requires that an advisor act solely in the best interest of the client, even if that interest is in conflict with the advisor’s financial interest. Investment Advisors must 61

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 61 of 144 disclose any conflict, or potential conflict, to the client prior to and throughout a business engagement."...

...Brian Mixdorf, CFE, CFS, Senior Investigative Agent, VP, Wells Fargo Corporate Investigations...

GH; ...Looks like Brian violated his ethics code.

Please assign a different person to handle this...

92. From: Spivey, William Sent: Thursday, January 05, 2012 10:56 AM To: Tolson, Ken Subject: RE: Ethics Line Issue

Ken, George is WAY out there. Do you wish for me to put a stop to this? . From: Spivey, William Sent: Thursday, January 5, 2012 2:31 pm To: Tolson, Ken Subject: RE: Ethics Line issue

No problem Ken. We are definitely on the same page.

Just ignore George on this issue going forward and I will take care of it. . From: Moseley, Bob C Sent: Friday, January 6 8:23 AM To: Mixdorf, Brian M ; Tolson, Ken Cc: Harris, Carolyn F; Mills, Craig (EAC); Huskey, Terry Subject: RE: On who reads our emails

Brian, Depending on the rigidity of Hartzman's ethics measuring stick, this could be the line in the sand where he may escalate his anxiety based on the perception that the "conspiracy" is continuing and being covered up with the closure of the case. ...I have closed my case as well... . From: Tolson, Ken Sent: Friday, January 6 9:18 AM To: Mixdorf, Brian M Cc: Harris, Carolyn F; Mills, Craig (EAC); Huskey, Terry; Moseley, Bob C Subject: RE: On who reads our emails

I hope Bill's talk with him will stop this. . Sent: Friday, January 6 9:45 AM To: Moseley, Bob C; Tolson, Ken Cc: Harris, Carolyn F; Mills, Craig (EAC); Huskey, Terry Subject: RE: On who reads our emails

It is getting quite thick. He is now emailing company senior audit leaders.

...This absolutely needs to end. . From: Mixdorf, Brian M Sent: Friday, January 6 10:24 AM To: Tolson, Ken Subject: RE: On who reads our emails

Ken, it's almost like he has a self-fulfilling prophecy to self-destruct in trying to get his message heard. It could be all calculated, so we need to calculate every move.

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 62 of 144 93. From: George Hartzman Sent: Monday, January 09, 2012 1:09 PM To: 'Brian Clarey' Cc: 'Allen Johnson'; '[email protected]'; '[email protected]'; '[email protected]'

Subject: RE: Ethics Line Issue to keep in your email files

So far, no one wants to touch it.

I’m told it has been sent higher, and to not stir kettle for the moment.

Told “you don’t want to be marked” [GH; By Bill Spivey]

Facts: Our earnings reports were inaccurate.

I teach the ethics component for NC CPAs.

Some of my clients, including myself and my family, were harmed by my not knowing what I should have.

Lots of folks made a mint doing what they were told.

I and mine lost. They lied. I teach ethics. If I don’t object, I am a fraud.

94. On January 11, 2012, I submitted a complaint to the Securities Exchange Commission, citing Sarbanes Oxley.

Reference Number; TCR1326304475861

"Material misstatement or omission in a company's public filings or financial statements"

95. From: William D. Spivey Sent: Thursday, January 19, 2012 11:32 AM To: Hartzman

Subject: RE: Please provide an update on this ethics issue. This is some info from the 10ks etc...

“George, I thought we agreed that you would stop this??”

William D. Spivey . Sent: Thursday, January 19, 2012 11:34 AM To: William D. Spivey

Subject: RE: Please provide an update on this ethics issue…

“How can I teach ethics and do nothing?”

George Hartzman . From: William D. Spivey Sent: Thursday, January 19, 2012 11:36 AM To: Hartzman

Subject: RE: Please provide an update on this ethics issue...

“You have been warned to stand down on this, that is all I'm saying.”

William D. Spivey . From: [email protected] Sent: Thursday, January 19, 2012 1:39 PM To: William D. [email protected]

Subject: RE: Please provide an update on this ethics issue…

“Fair enough. 63

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 63 of 144

I would like to escalate this up the management chain on our side

“I believe there has been "Misprision of Felony" by some Wells Fargo employees as a result of what occurred.”

George Hartzman

96. I believed my life and family was in danger, as I accused the top brass of the company that I worked for of securities fraud and insider trading, amongst many others in the financial industry, as the ethics line and internal investigators seemed to not want to pursue the issue after repeatedly violating my anonymity.

On May 22 2008, unknown to shareholders but known to JPM CEO Jamie Dimon, J.P. Morgan Chase Bank borrowed $2 billion from the Federal Reserve Bank's Term Auction Facility at 2.1% interest, with a massive and material $90.536 billion in Unencumbered Collateral representing an undisclosed credit line with the Fed.

On Nov 6 2008, unknown to shareholders but known to JPM CEO Jamie Dimon, J.P. Morgan Chase Bank borrowed $5 billion from the Federal Reserve Bank's Term Auction Facility at 0.6% interest, with $81.700 billion in Unencumbered Collateral representing an undisclosed credit line with the Fed.

On Dec 23 2008, unknown to shareholders but known to JPM CEO Jamie Dimon, J.P. Morgan Chase Bank borrowed $10 billion from the Federal Reserve Bank's Term Auction Facility at 0.6% interest, with $81.080 billion in Unencumbered Collateral.

JPM's annual report doesn't mention of the overall size of JPM's Federal Reserve Term Auction Facility credit lines, interest rates and maturities, all of which were material inside information known to Jamie Dimon but not JPM shareholders, the public or presumably the SEC.

On 2009-01-16, while JPM was in possession of an undisclosed Federal Reserve provided Term Auction Facility credit line of more than $80 billion, Jamie Dimon purchased 500,000 of J.P. Morgan stock valued at $11,464,500 without being prosecuted for Insider Trading and Securities Fraud. . . During late 2007 and throughout 2008, unknown to shareholders but known to Citibank CEO Vikram Pandit, who certified Citibank's 2008 annual report filed with the SEC, Citibank borrowed billions from the Federal Reserve Bank's Term Auction Facility on nine occasions at interest rates as low as 0.42%, with up to $21.371 billion in Unencumbered Collateral representing an undisclosed credit line with the Fed, details of which were not disclosed in Citibank's 2008 annual report.

On 2008-11-13, while Citibank was in possession of undisclosed Fed provided Term Auction Facility loans, Citibank CEO Vikram Pandit purchased 850,000 shares of Citibank stock valued at $9,633,050 without prosecution for Insider Trading and Securities Fraud.

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 64 of 144 97. From: [email protected] to: [email protected], [email protected]

Date: Thu, Feb 2, 2012 at 12:18 PM Subject: More stuff

…Wells Fargo & Co., seeking to shake the stigma of government bailout funds and keep up with its rivals, plans to raise $10.4 billion in a share sale so it can get out of the Troubled Asset Relief Program. The bank plans to return all of the $25 billion that taxpayers invested last year, according to a company statement issued yesterday...

...Banks chafed under restrictions imposed by the program, which affect lending, foreclosures, pay, and perks. Wells Fargo chairman Richard Kovacevich initially said he did not want TARP money and later called government stress-tests tied to the program "asinine." http://www.boston.com/business/articles/2009/12/15/wells_fargo_to_pay_back_bailout_fun ding/ . From: Landry, Aaron - Sent: Tuesday, February 14, 2012 3:53 PM – To: Hartzman, George; Spivey, William – Subject: Re: Please provide an update on the ethics thing.

George. I am your contact and will facilitate your inquiry and allegation.

Landry, Aaron . From: Hartzman, George Sent: Wednesday, February 22, 2012 9:55 AM To: Landry, Aaron Cc: Rogers, William H.

Subject: Please provide an update on the ethics thing...

98. Plaintiff was informed on February 22, 2012 a response from Wells Fargo senior management should be forthcoming, which did not occur until May 8, 2012;

Sent: Wednesday, February 22, 2012 10:37 AM To: Hartzman, George Cc: Rogers, William H.; Lowe, Doug

Subject: Re: Please provide an update on the ethics thing.

George,

As discussed the region is looking into your concerns and I will be back to you when we have a response.

I hope that will be this week.

Aaron Landry Wells Fargo Advisors, Managing Director, Central North Carolina.

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 65 of 144

...Is this correct?

I have not received an answer as to whether the loans took place.

George Hartzman . If some misled, or omitted… how can the case be closed?... . “It is the responsibility of all team members to raise concerns about behavior that may violate the Code or any laws, rules, or regulations.”

Wells Fargo’s Code of Ethics and Business Conduct

99. Sent: Wednesday, February 22, 2012 10:37 AM from: [email protected] to: [email protected], [email protected], [email protected], [email protected], [email protected], [email protected], [email protected], [email protected], [email protected], [email protected], [email protected], [email protected], [email protected]

Attachments; 10k.doc

“LIQUIDITY AND FUNDING

Asset liquidity is further enhanced by our ability to sell or securitize loans in secondary markets and to pledge loans to access secured borrowing facilities through the Federal Home Loan Banks, the Federal Reserve Board, or the U.S. Treasury...

[GH; Ability doesn't mean borrowed] . “The Audit and Examination Committee of the Wells Fargo & Company Board of 66

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 66 of 144 Directors will oversee the investigation of concerns raised about accounting, internal accounting controls, and auditing matters.”

Wells Fargo’s Code of Ethics and Business Conduct . “The Audit and Examination Committee is a standing audit committee of the Board of Directors established in accordance with Section 3(a)(58)(A) of the Securities Exchange Act of 1934.

The Committee has eight members: John D. Baker II, Lloyd H. Dean, Enrique Hernandez, Jr., Robert L. Joss, Cynthia H. Milligan, Nicholas G. Moore, Philip J. Quigley and Susan G. Swenson.”

Short-term borrowings averaged $65.8 billion in 2008 and $25.9 billion in 2007, an increase of $39.9 billion due to business funding needs.”

2008 10k

We reduced short-term borrowings due to the continued liquidation of previously identified non-strategic and liquidating loan portfolios, soft loan demand and strong deposit growth.”

2009 10k . "Congress passed legislation calling on the Federal Reserve to identify banks and other financial institutions that received more than $2.3 trillion in taxpayer-backed loans and other financial assistance.

…The provision paves the way for additional legislation in the area calling on the Federal Reserve to reveal the names of institutions that received assistance, to specify how much money each bank took, and to detail what the financial institutions are doing with the money.

"During the worst financial crisis in our nation's history since the Great Depression - a crisis which has led to the largest taxpayer bailout ever - the very least we can do is explain to the American people what the Federal Reserve is doing with their hard-earned taxpayer dollars," Sanders said.

At a Senate Budget Committee hearing on March 3, Sanders asked Fed Chairman Ben Bernanke to name the hundreds of banks that took money since the financial crisis began.

Bernanke refused to name any of the financial institutions and would not say what the banks are doing with the money.

Sanders noted that a separate $700 billion financial rescue package that was signed into law last October requires the Treasury Department to identify recipients of bailout funds. http://www.sanders.senate.gov/newsroom/news/?id=531a8de5-e7db-4dc9-a126- 6d1d1285178f . "Only months after it was started, the U.S. program designed to purge debts of no immediate discernable value from the balance sheets of troubled banks has helped transform the frozen debt into a money-maker as the bonds have rallied. 67

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 67 of 144

…Under the program, asset managers were supposed to raise money from investors and, with additional capital and loans from taxpayers, buy as much as $1 trillion in toxic assets from U.S. banks, freeing up money for lending.

It’s “absolutely ridiculous” that banks, which were expected to reduce their holding of such volatile mortgage securities, bought them before the government program was running and may now profit, said Michael Schlachter,

…“Some of them created this mess, and they are making a killing undoing it.”

…Neither the Treasury nor the funds have disclosed how much and what debt has been bought. Prices for some of the securities that the funds were supposed to buy have almost doubled since March. http://www.bloomberg.com/apps/news?pid=newsarchive&sid=aOU4QAVClHXI&pos=3 . News Release; Wells Fargo Completes Repayment of TARP

SAN FRANCISCO — December 23, 2009

Wells Fargo & Company (NYSE: WFC) said today that it has redeemed the $25 billion of series D preferred stock issued to the U.S. Treasury under the Troubled Asset Relief Program’s Capital Purchase Program.

…As previously stated, by repaying the TARP investment, Wells Fargo will eliminate $1.25 billion in future annual preferred stock dividends.

… John Stumpf, president and chief executive officer of Wells Fargo & Company. “We thank the U.S. government and taxpayers for their support of our financial system at a critical time for our nation.

…As previously announced, the company sold 489.9 million shares of common stock at $25.00 per share for a total of $12.25 billion in a common stock offering completed December 18, 2009. Net proceeds of this common stock offering and excess liquidity were used to repay the $25 billion TARP investment and accrued dividends. https://www.wellsfargo.com/press/2009/20091223_tarp_repayment . News Release; Wells Fargo Senior Leaders Receive Retention Performance Share Grants

SAN FRANCISCO — December 31, 2009

Wells Fargo & Company’s (NYSE: WFC) board of directors approved a grant of retention performance shares for President and CEO John G. Stumpf and three other executive officers. …the retention performance shares provide an incentive for these executives to achieve continued extraordinary results for the Company.

…Together these four senior leaders have more than 125 years of experience and retaining them, along with our entire senior management team, is clearly in the best interest of our Company and its shareholders and absolutely essential for the continued long term success of Wells Fargo.” https://www.wellsfargo.com/press/2009/20091231_retention_shares

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 68 of 144 “C. Insider Trading

Insider trading involves the purchase or sale of securities of a company or other entity while in possession of material, nonpublic information (also called “inside information”) about the company or entity.

1. Material Inside Information - “Inside” or “nonpublic information” is information about a business organization that is not generally available to or known by the public.

Such information is considered to be “material” if there is a likelihood that it would be considered important by an investor in making a decision to buy or sell a company’s securities…”

Director Code of Ethics Wells Fargo & Company

“Information should be presumed “material” if it relates to, among other things, any of the following: • significant gains or losses; • significant merger or acquisition proposals or agreements; • significant purchase or sale of assets; • significant borrowing; • new debt or equity offerings; • liquidity problems...”

Director Code of Ethics Wells Fargo & Company . “Ethics Committee Review

If a disclosure, request for approval, or exception request arises that is not discussed in the Code, or if application of the rule to a set of circumstances is unclear or has broad policy implications, the Code Administrator or member of the Operating Committee who initially received the request or disclosure may forward the documentation to the corporate secretary, care of Wells Fargo Legal Group, for referral to and resolution by the Ethics Committee.

[GH; Code administrators above received this email]

The corporate secretary or the Ethics Committee will notify the Code Administrator and the Operating Committee member of the Ethics Committee’s decision.

A copy of each disclosure or request, noting the approval or disapproval by the Ethics Committee, must be returned to the team member and a copy, with the team member’s Employee ID included, shall be forwarded to Employee Records for placement in the team member’s official personnel file.

[GH; I received nothing but formal warnings, and there wasn't any information in the discovery to date that indicates the issue ever went to the Ethics Committee]

...The Audit and Examination Committee of the Wells Fargo & Company Board of Directors will oversee the investigation of concerns raised about accounting, internal accounting controls, and auditing matters.

Wells Fargo’s Code of Ethics and Business Conduct

[GH; There wasn't any information in the discovery to date that indicates the issue ever went to the Audit and Examination Committee of the Board which was supposed 69

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 69 of 144 to oversee Brian Mixdorf's investigation]

Were the reports accurate?

Was this information disclosed? http://www.bloomberg.com/data-visualization/federal-reserve-emergency- lending/#/compare/?comparelist=Wachovia_Corp-Wells_Fargo_%2526_Co

If it is my responsibility to raise concerns and nothing happens, what is my responsibility to whom after?

Is this a usual response for those who stick their necks out?

Should one who raises concerns be informed of the investigative outcome? . “Being advocates for clients – putting their interests first and foremost in every decision we make – is the right thing to do. This is what we believe as a firm.”

Danny Ludeman, President and CEO, 2012

100. Excerpts from the attachment entitled 10k which was forwarded along with Aaron Landry's reply on March 4, 2012 at 12:12 PM; subject: Please provide an update to [email protected], [email protected], [email protected], [email protected], [email protected], [email protected], [email protected], [email protected], [email protected], [email protected], [email protected], [email protected], [email protected];

Executive Officer Exceptions

Exceptions to the Code for the chief executive officer and other executive officers of Wells Fargo & Company must be approved by the Audit and Examination Committee of the Board of Directors of Wells Fargo & Company and, if approved, will be promptly disclosed to Wells Fargo stockholders in accordance with legal and regulatory requirements.

Recordkeeping

Code Administrators are responsible for all Code-related recordkeeping.

All disclosures, requests for approval or consent, requests for exceptions, and other Code documentation must be retained in the team member’s official personnel file. https://www.wellsfargo.com/downloads/pdf/about/team_member_code_of_ethics.pdf

...The Fed didn’t tell anyone which banks were in trouble so deep they required a combined $1.2 trillion on Dec. 5, 2008, their single neediest day.

Bankers didn’t mention that they took tens of billions of dollars in emergency loans at the same time they were assuring investors their firms were healthy.

Bloomberg 70

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 70 of 144

"We reduced short-term borrowings due to the continued liquidation of previously identified non-strategic and liquidating loan portfolios, soft loan demand and strong deposit growth.”

2009 10k

"Any form of “gaming” to receive compensation, ...is in direct violation of company policy and this Code.

Gaming is defined as the manipulation, misrepresentation, or both of ...reporting in an attempt to receive compensation..."

Wells Fargo’s Code of Ethics and Business Conduct

Board members must avoid conflicts of interest or the appearance of conflicts of interest in their activities.

A conflict of interest is a situation in which a director’s personal interest or outside economic interest in a matter:

...raises a reasonable question about or the appearance of such interference, inconsistency, or improper personal benefit.

Ethics

We strive for the highest ethical standards with team members, customers, our communities and shareholders. Honesty, trust and integrity are essential for meeting the highest standards of corporate governance. They’re not just the responsibility of our senior leaders and our board of directors. We’re all responsible. All 275,000 of us. Corporations don’t have a conscience. People do. Our ethics are the sum of all the decisions each of us makes every day. If you want to find out how strong a company’s ethics are, don’t listen to what its people say. Watch what they do. This is even more important in our industry because everything we do is built on trust. …Our customers trust us to protect their money.

…They trust our financial consultants to give them the right financial advice.

..We behave ethically when we:

•Value and reward open, honest, two-way communication. •Hold ourselves accountable for, and are proud of, our decisions and our conduct. •Only make promises we intend to keep—do what we say we’ll do. If things change, let people know. •Share information with our colleagues that they need, and let them know if things change. •Avoid any actual or perceived conflict of interest. •Comply with the letter and the spirit of the law. •Acknowledge and apologize for our mistakes, and learn from our errors so we don’t make them again.

We want compliance and risk management to be part of our culture, an extension of our code of ethics. Everyone shapes the risk culture of our company. We encourage all team members to identify and bring risk forward. We should thank them for doing so, not penalize them. Ben Franklin was right: An ounce of prevention is worth a pound of cure.

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 71 of 144 We value what’s right for our customers in everything we do. …Our customers—external and internal—are our friends. We advocate for their best financial interests.

…We put their long-term financial interests first by: Starting every discussion with what’s best for them. https://www.wellsfargo.com/invest_relations/vision_values/6

What am I supposed to tell my clients?

As a Fiduciary, how should I respond?

If the investigation is complete, where is the report?

Please explain how I am acting in my clients best interests

If I accept your answer and do nothing more?

How can I disclose "all material facts" If I am not informed of what they are?

I thought I had a "reasonable, independent basis for their investment advice"

Until it was reported that I may not have had, which creates a conflict of interest

Which I have not been given a way to deal with If I don't know what I should?

As a Fundamental Choice Portfolio Manager Do I not have a fiduciary obligation to my clients?

If my job is to act in the best interests of my clients, and a question of the best interests of my clients has been questioned, How should I respond to what some may consider to be an obfuscational response?

Did the Board of Directors oversee the investigation?

Were the reports accurate?

Was this information disclosed?

"...Wells Fargo bought Wachovia Corp., ...because depositors were pulling their money from Wachovia, the Fed channeled $50 billion in secret loans…through two emergency-financing programs to prevent collapse before Wells Fargo could complete the purchase."

Bloomberg

Is this correct?

"Falsification of any company or personal information that you provide is prohibited.

Falsification refers to knowingly misstating, altering, adding information to, or omitting or deleting information from a Wells Fargo record or system which results in something that is untrue, fraudulent, or misleading."

Wells Fargo’s Code of Ethics and Business Conduct

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 72 of 144 If some misled, or ommitted… How can the case be closed?

101. These communications appear to show the Board of Directors was waived off by Ken Tolson;

From: Board Communications Sent: Monday, March 05, 2012 2:41 PM To: Tolson, Ken

Subject: BOD Case HARTZ0304412B Hartzman, George DUE 3/16/12

...CRA Complaints received the following BOD Case HARTZ0304412B Hartzman, George DUE 3/16/12. Please review the attachment and advise within one business day if your line of business can assist with the following customer's concern. We will close the case on our end with your acceptance. If this should be routed elsewhere, please let us know.

Thank you,

Jessica Venable Compliance Specialist CRA Risk Management

From: Board Communications Sent: Wednesday, March 07, 2012 11:09 AM To: Tolson, Ken Subject: FW: BOD Case HARTZ0304412B Hartzman, George DUE 3/16/12

...Please indicate if you will be responding to this case. We can close the case on our end with your acceptance.

Thank you,

Jessica Venable Compliance Specialist CRA Risk Management . From: Tolson, Ken Sent: Wednesday, March 7, 2012 2:19 PM To: Board Communications Subject: RE: BOD Case HARTZ0304412B Hartzman, George DUE 3/16/12

Jessica,

This issue is being looked in to and the complainant has been contacted. Please let me know if I can assist with anything else.

Sincerely,

Ken . From: Board Communications Sent: Wednesday, March 07, 2012 5:24 PM To: Tolson, Ken

Subject: RE: BOD Case HARTZ0304412B Hartzman, George DUE 3/16/12

Ken,

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 73 of 144 Thank you - that note is perfect!

Jessica Venable

From: Board Communications Sent: Friday, March 09, 2012 9:50 AM To: Tolson, Ken

Subject: RE: BOD Case HARTZ0304412B Hartzman, George - ADD INFO

Good Morning Ken,

CRA received additional information regarding BOD Case HARTZ030412B Hartzman, George DUE 3.16.12. The case has been closed on our end with your acceptance, however, we want to provide you with all relevant case information that we continue to receive. Thank you,

Jessica Venable . From: Board Communications Sent: Friday, March 09, 2012 1:03 PM To: Tolson, Ken Subject: RE: BOD Case HARTZ0304412B Hartzman, George - ADD INFO

Ken,

Shortly after I sent the below email regarding additional info, the Board inbox received the attached from Corp Security.

Jessica Venable . From: Tolson, Ken Sent: Monday, March 12, 2012 8:26 AM To: Board Communications Subject: RE: BOD Case HARTZ0304412B Hartzman, George - ADD INFO

Jessica,

Thank you for this update... I heard this morning these new complaints are also being looked in to. The complainant has not been responded to regarding the new complaints as of this moment but he will be contacted promptly...

Sincerely, Ken

102. ...Mr. Hartzman, ...The Company’s practice is not to share information relating to its review of such allegations. To the extent you continue to raise the same issues to which the Company already has been made aware, you will not receive any further response.

In your most recent Ethics Line complaint, you raised general concerns for the first time concerning alleged gaming in connection with Envision plans.

...Your continuous requests for updates from individuals with no knowledge of or involvement with your complaints are unproductive, interfere with the conduct of business, and hinder the Company’s review of your allegations.

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 74 of 144 Accordingly, the Company expects that all future communications regarding your Ethics Line allegations will be directed only to my attention (or others I may designate to assist with the Company’s review of your allegations). ...With respect to any other questions that pertain to your business, please continue to direct your inquiries to your manager.

Once again, we take your concerns seriously…

Brian Mixdorf, CFE, CFS

103. "FORMAL WARNING" DATE: March 13, 2012

...“...As you have been repeatedly advised, your initial concerns have been addressed.

...All future communications regarding your most recent Ethics Line allegations are to be directed only to the attention of Brian Mixdorf in Corporate Investigations (or others he may designate to assist with the Company’s review of your allegations).

...With respect to any other questions that pertain to your business, please continue to direct your inquiries to your manager." . GH; "Whoever wrote this letter with Bill who remain nameless may want to re-think their anonymity.

Did the Board of Directors oversee the investigation?

As of Wednesday, March 28, 2012, I have not received an answer as to whether the Board investigated.”

GH; “I believe my clients, myself and many others have been betrayed by the above.

My Wells Fargo Ethics Line effort compromised by anonymity. Were the reports accurate? Was this information disclosed?

...As of Wednesday, March 28, 2012, I have not received an answer as to whether the loans took place...

GH; If some misled, or omitted… how can the case be closed?... . From: Hartzman, George Sent: Tuesday, March 20, 2012 9:04 AM To: Mixdorf, Brian M.; Spivey, William

Subject: RE: Ethics Line Call

Bill, since I have been told to not contact anyone but you or Brian, please let me know what can be done here.

I still don't have any guidance as to what to tell my clients and who wrote the warning letter.

I believe Brian violated my anonymity.

I believe Brian has knowingly engaged in conduct with a conflict of interest, failed to obtain and reveal material evidence and is not being truthful.

From the warning letter: "As always, I am available if you have questions or need 75

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 75 of 144 clarification of this warning."

I would like to contact whoever I is.

104. From: Mixdorf, Brian M. Sent: Tuesday, March 20, 2012 8:45 AM To: Hartzman, George; Spivey, William Subject: Re: Ethics Line Call

Hi George, as I instructed when you called me last Wednesday

...I needed for you to send me as email as to when you were available.

To this date, I have not received that email from you.

Please advise when you are available this week.

Thank you George. . [GH; Response;] Please provide the name and phone number of who ever wrote the warning letter.

Brian, if you feel you have not violated your ethics code, please explain why.

George Hartzman . From: Hartzman, George Sent: Tuesday, March 20, 2012 9:04 AM To: Mixdorf, Brian M.; Spivey, William Subject: RE: Ethics Line Call

I see you [Brian] took your [CFE] signature out of your emails.

Bill, since I have been told to not contact anyone but you or Brian, please let me know what can be done here.

I still don't have any guidance as to what to tell my clients and who wrote the warning letter. I believe Brian violated my anonymity. I believe Brian has knowingly engaged in conduct with a conflict of interest, failed to obtain and reveal material evidence and is not being truthful.

From the warning letter: "As always, I am available if you have questions or need clarification of this warning."

I would like to contact whoever I is.

George Hartzman

105. From: Hartzman, George Sent: Tuesday, March 27, 2012 2:04 PM To: Spivey, William Subject: Please confirm Aaron Landry Failure to Supervise complaint. . From: Hartzman, George Sent: Wednesday, March 28, 2012 11:09 AM To: Spivey, William

“George,

In response to your continued suggestion that you do not know what to tell your clients, I again would like to stress that you are responsible for acting in the best interest of your clients.” . 76

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 76 of 144 GH; I believe I am acting in the best interests of my clients. . “The Firm has numerous resources available to assist you in providing guidance...” . GH; These resources have nothing to do with the question of what to tell my clients if Wells Fargo Management doesn't disclose what it should. . “There simply is no credible basis for your suggestion that the issues you have raised relating to Fed loans between 2007-2009 somehow prevent you from being able to advise your clients about the many opportunities that exist in today’s market.” . GH; I disagree. How can I advise on "opportunities" in an environment in which I am unsure as to what to tell my clients the truth is, as to whether or not the market is being manipulated or not?

I believe Sarbanes–Oxley has been violated.

I believe Wells Fargo's Ethics Code has been violated.

I believe my client's best interests have been violated.

I believe I provided my clients inaccurate information because of the above.

I believe I have been lied to.

I believe my clients have been lied to.

I believe no one has been held accountable.

I believe a select few profited from information my clients lost money because of.

I believe many Wells Fargo Envision Plans have been routinely manipulated to game compensation by not including investment costs and accurate inflation assumptions.

"Misrepresentation and Omissions

A brokerage firm or broker can be held liable if that firm or broker misrepresents material facts or omits to disclose material facts…

...“If you are unable or unwilling to do your job and act in your clients best interests, you need to let me know immediately so that the firm can take steps to ensure their interests are protected.”

GH; I believe I am acting in the best interests of my clients, my family, my country, and the company I work for. . “Second, you have repeatedly been asked to provide your Asset Advisor notes. Donna Washburn requested notes in an email correspondence dated March 7, 2012. Ms. Washburn verbally requested your notes on March 15th and 26th. Additionally, I requested that you provide your Asset Advisor notes on March 15th and 26th. To date you have not provided the requested notes.” . GH; [I didn’t put notes on accounts because no one would tell me about Wells’ accounting issues or how I defrauded my clients to receive a retention bonus.] . 77

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 77 of 144 ...GH; As of March 28, 2012, there are no Asset Advisor Accounts relative to my name.

[GH; I sacrificed needed income by eliminating the wrap accounts, much of which were in cash and short term investments, because I didn’t know what the deal was, and because I didn’t want to write about these issues in client notes, which I eventually did.]

GH; Please peruse my outgoing correspondence files, and compliance approvals for literature I have sent my clients.

GH; I have heard from two clients today, that they received calls yesterday from Wells Fargo management.

GH; How is this not potential retaliation?

[GH; I believe many of my clients were targets of extraordinary upper management phone calls meant to find client/advisor issues.] . . “Your allegations of failure to supervise [against Aaron Landry] have been noted and escalated internally...

Thanks, -Bill [GH; Initial discovery provided no information on the complaint.] . "...When a broker engages in negligence or wrongdoing that causes damages to a client the supervisor is also subject to liability for allowing the act(s) to occur.

… it is quite possible for a supervisor or firm to be liable to the client for damages without the broker being liable.

For example, if the broker was improperly trained, given false information by the firm, not properly licensed, et cetera, the firm may be liable to the client for damages even if the broker is not."

Multiple Sources

I believe my clients, myself and many others have been betrayed by the above.

My Wells Fargo Ethics Line effort compromised by anonymity.

George Hartzman

106. In the Matter of; George Hartzman, Complainant, v. Wells Fargo Advisors, LLC., Respondent, Case No. 2013-SOX-00045 Wells Fargo refused to provide Complainant's Request for Production #13 concerning Complainant's Failure to Supervise complaint against Aaron Landry.

Complainant's Request for Production #13 sought all discoverable documentation and communications concerning Wells Fargo Advisors’ investigation of Complainant’s Failure to Supervise complaint against Aaron Landry, including the names of all those Landry was in contact with and when, and any discoverable documentation and communications with said contacts.

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 78 of 144 The documents and communications refused in the Request directly relate to Wells Fargo's handling and processing of Complainant’s initial reporting of what reasonably believed to be illegal activity by Wells Fargo.

107. From: Hartzman, George Sent: Thursday, March 29, 2012 1:55 PM To: Spivey, William

Subject: Account calls.

Please provide how many calls to which clients have occurred over the last week.

Please include all dialed numbers, with corresponding names, as opposed to just those contacted. . From: Spivey, William Sent: Monday, April 02, 2012 12:53 PM To: Hartzman, George

Subject: RE: Account calls. George, we will discuss further, but these client calls were a direct result of repeated requests for asset advisor notes and your initial responses that you really didn't know what to tell your clients as a result of the firm not addressing your concerns. This was part of a normal compliance review and was requested of Brian by the compliance group. The call that we will have tomorrow is also part of this ongoing review. As I have mentioned before, the review, nor the client contacts, are in any response to your ethic line concerns, but are a direct result of us not having readily available documentation for client contact and review as outlined in the asset advisor program guidelines. Bill

108. From: Hartzman, George Sent: Wednesday, April 11, 2012 8:54 AM To: Spivey, William Subject: Material Borrowing

Is Wells Fargo currently borrowing material undisclosed money?

George Hartzman

109. Congessman Brad Miller

Former US Congressman, Member; Financial Services Committee; Committee on Financial Services Subcommittee on Capital Markets, Insurance, and Government-Sponsored Enterprises; Subcommittee on Financial Institutions and Consumer Credit; Subcommittee on Oversight and Investigations

Of Council at Grais & Ellsworth LLP

Senior Fellow for Economic Policy, The Center for American Progress . Part of a Facebook message conversation with Brad Miller;

I believe my clients have been lied to. I believe a select few profited from information my clients lost money because of. I believe my fiduciary obligations to my clients have been violated by Wells Fargo. I believe many Wells Fargo Envision Plans have been routinely manipulated to game compensation by not including investment costs and accurate inflation assumptions. I believe I am acting in the best interests of my clients, my family, my country, and the company I work for. I believe my clients, myself and many others have 79

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 79 of 144 been betrayed by the above. My Wells Fargo Ethics Line effort compromised by anonymity. I have been threatened with termination twice in three weeks. I believe no one has been held accountable. I believe I have been lied to.

George Hartzman, Vice President/Investments, April 15, 2012 . “Have you contacted my office to set an appointment?” - Brad Miller . “Thank you very much for the reply Brad. I would very much like to meet with you. will call to set up. ...thanks.” - George Hartzman .

"Please call my Raleigh office and ask to speak to Phyllis.”

Brad Miller . "They violated Sarbanes Oxley."

George Hartzman . "What if a teacher of the North Carolina CPA Ethics component were to blow a whistle, and not one mainstream media outlet, like the Greensboro News & Record, reported it?"

Sent to Brad Miller via Facebook, June 18, 2012 . After multiple calls to Brad Miller’s office, I was never able to get an appointment. . Tom Koonce, formerly Brad Miller’s legislative director, is now a JP Morgan lobbyist.

Brad Miller’s total campaign contribution receipts between 1989 and 2012 was $6,011,785, of which Lawyers/Law Firms gave $852,417, Insurance; $266,219, Securities & Investment; $173,825, Commercial Banks; $104,750, Accountants; $92,346, Credit Unions; $79,341 and Lobbyists; $64,400.

After taking so much money from the above, Mr. Miller ended up less than helpful.

110. From: [email protected] Date: Mon, Apr 30, 2012 at 10:20 AM Subject: New Accounts To: [email protected]

I have the opportunity to open an account.

I feel as though I cannot, because the Ethics Line situation is not resolved.

Please advise.

111. It took Wells Fargo from early December, 2011 to May, 2012 to answer:

From: Spivey, William Sent: Tuesday, May 08, 2012 4:17 PM To: Hartzman, George

George,

I am writing in response to your recent emails asking about whether the Company has obtained material loans that it has not disclosed. I have looked into your questions and am writing to provide you with a response on behalf of the Company.

Wells Fargo follows the United States Generally Accepted Accounting Principles in connection with its required public disclosures. Pursuant to GAAP, all of the Company’s 80

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 80 of 144 lending arrangements are disclosed in the Company’s reports filed with the Securities and Exchange Commission. Moreover, you previously suggested that Wells Fargo has accepted undisclosed loans from the Federal Reserve. Once again, any loan amounts on the Company’s balance sheets at period end would have been included in the Company’s disclosures. As I am sure you understand, whether the Fed separately reported any such loans was not up to the Company.

I trust that this response confirming that the Company fulfills its financial reporting obligations provides you with the information you need. Please be advised that the Company will not be responding further to any other questions from you regarding these issues.

Hopefully, we can discuss this in person first thing in the morning.

Thanks

Bill

112. From: george.hartzman Date: Wed, May 9, 2012 at 6:41 PM Subject: The Sarbanes-Oxley Act To: [email protected]

Bill and Unkown Others;

The issue in question involves the Sarbanes-Oxley Act.

As noted below, the Sarbanes-Oxley Act is in addition to GAAP accounting.

George Hartzman

113. From the Privilege Log provided by Defendant;

According to the privilege log provided by Wells Fargo, listed as Attorney-Client Privilege, on Monday, May 10, 2012, two events occurred described as "E-mail re; The Sarbanes - Oxley Act" involving Phil Toben, Senior Counsel, John Anderson, Assistant General Counsel, and Aaron Landry, William Spivey of Wells Fargo, who terminated George Hartzman.

Wells Fargo's Phil Toben, Senior Counsel and John Anderson, Assistant General Counsel appear to have lied by omission to Plaintiff via William Spivey, which appears to be an adverse retaliatory employment action.

114. From an investigation into the breach of confidentiality by Brian Mixdorf, which doesn't mention other breaches of confidentiality by Mixdorf;

From: Harley, Suzanne E Sent: Wednesday, May 16, 2012 3:31 PM To: Hartzman, George Subject: Confidential: Follow-Up Importance: High Sensitivity: Confidential

George: Several weeks ago, you raised an allegation about Brian Mixdorf, Corporate 81

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 81 of 144 Investigator. Brian was investigating some complaints that you had made in reference to Wells Fargo. The complaint that came to me involved your allegation that Brian had not kept your initial complaint confidential. You stated that because he used the word/term “EthicsLine” in the “Subject” line of his email, he violated your confidentiality.

You stated that there is someone in Wells Fargo Advisors who reads all of your email for regulatory reasons. I have spoken with Brian Mixdorf about his investigation practices and how he handled your initial complaint. I have also spoken with you. Finally, I spoke with the Team Member who is assigned to review emails from your area. Based on all of these interviews, I find that Mixdorf handled the investigation properly, did not violate your confidentiality by sending the email to you as described above and that there was no policy violation. Thank you for giving me the opportunity to look into this issue on your behalf.

Suzanne E. Harley

115. On February 20, 2009, taxpayer bailed out Citigroup’s Morgan Stanley Smith Barney announced about a $2 to $3 billion retention plan to retain their securities brokers. The same day, Wachovia Securities announced the firm's brokers would not receive a retention bonus, but financial advisors could receive payouts from its 4front program, which involved creating "Envision" investment/financial plans for current clients.

Janet Levaux of Advisor One reported “For 4front, advisors must complete financial plans using the company's Envision software for at least 25 households with $250,000 in assets under management...This makes our company a compelling place for advisors to stay and run their business," said Wachovia Securities spokesperson Anthony Mattera. Halah Touryalai of Wealth Management.com reported “...the firm takes a “snapshot” to look at how many households and assets advisors have in Envision Plans. The more households and assets with “Envision Plans,” the larger the bonus a rep can receive.”

116. Plaintiff chose not to apply/qualify for 4front until U.S. taxpayers were paid back money loaned through TARP. When the first round of Envision plans were created, word came down from executive management imploring our office to not create too many Envision plans at the same time to keep up appearances.

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 82 of 144

117. On September 7, 2012, in front of 25 to 40 financial advisors at the Hyatt Regency St. Louis at The Arch, Greg Shiveley, Envision Sales Manager at Wells Fargo Advisors, said “There are 441,942 households with Envision Plans of Record.” and “The overwhelming majority of Envision Plans do not include investment costs." One reason so many Wells Fargo households have Envision Plans of Record (POR), was to avoid negative press coverage by obscuring retention bonuses after the company received overt and covert taxpayer funded bailouts. If the average household with an Envision Plan had $400,000, about $177 billion of client assets may be involved. If “the overwhelming majority of Envision Plans [did and] do not include investment costs,” and Plans of Record appear on client statements, hundreds of thousands of Wells Fargo clients are currently being illegally misinformed as to the probabilities of achieving their financial goals;

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 83 of 144

118. Plaintiff violated his fiduciary responsibilities to clients with advisory accounts by not including investment fees in Envision plans, along with thousands of other Wells Fargo Financial Advisors. Wachovia Securities executives who visited the Greensboro’s 3623 North Elm Street Branch told a meeting of brokers that the retention program tied to Envision investment plans was set up to avoid critical press reports about TARP being money used to “retain” financial advisers. We were told “do the plans and get paid.”

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 84 of 144 119. Envision plans can be manipulated to sell clients and prospects on new investment ideas, staying on a current course with a financial adviser, and with the "retention" plan, game compensation in violation of Investment Advisers Act of 1940.

These outcomes are repeatable, meaning this can be duplicated on any Wells Fargo Advisors computer by others investigating independently.

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 85 of 144 120. The following “Internal Use Only” document states: "If left at 0%, the Return Discount Rate will not be displayed on any Envision report pages. If you choose a Return Discount Rate above 0%, this assumption will be displayed on the Investment Plan Assumptions report page." Meaning if the "Return Discount Rate", otherwise known as annual investment fees aren't included, the information does not show up in the client presentation, even though inflation, tax and turnover measures do.

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 86 of 144 121. As shown after the third main bullet point below, "Return Discount Rate" was called “Annual Investment Fee” before 2012;

122. The following shows a comparison of two reproducible versions of the same Wells Fargo Envision Plan with one difference - investment fees.

"Harold Lynn" has $1,000,000 invested, with an annual investment fee of 2.5%.

Both versions have the same data inputs, except the second plan doesn't include the investment fees, like "the overwhelming majority of Envision Plans.” The first plan includes 2.5% annual investment fees, which Harold is currently paying.

Again, Investment fees are not shown on client presentations unless entered, as seen on the following pages, even though both presentations include everything else. Notice "Return Discount Rate" under "Investment Assumptions"

Note the absence of the “Return Discount Rate” under the description of “Investment Assumptions” in the second version of the plan.

Section 206 of the Investment Advisors Act of 1940 states "It shall be unlawful for any investment adviser, …to employ any device, scheme, or artifice to defraud any client or prospective client; to engage in any transaction, practice, or course of business which operates as a fraud or deceit upon any client or prospective client; or... to engage in any act, practice, or course of business which is fraudulent, deceptive, or manipulative.";

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 87 of 144

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 88 of 144 123. Without the investment fees included for Harold’s $1,000,000, Envision's software can generate the following client compliance approved graph indicating a high degree of wonderfulness if Harold continues to follow the recommendations.

The above graph shows the client's projected outcome with the Return Discount Rate set on default; 0%;

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 89 of 144 124. The problem is the Envision Plan including what Harold is actually paying for his investments, is that he would need to begin with about $840,000 more to achieve similar results, meaning the plan not including the 2.5% annual investment fees clearly appears to be misleading.

125. The black dot on the Y axis of the charts indicates Harold's $1,000,000.

The two rising lines represent the “Target Zone”, which the software identifies as a “reasonable level of confidence that goals can be met or exceeded.”

The lowest lines in the graphs represent a 75% chance of reaching Harold’s goal.

The lines are much higher on the bottom graph when investment fees are included.

Wells Fargo Advisor's Internal Use Only "Presenting Envision results that matter" states "If the client has any doubts about the underlying assumptions, Advisors should be prepared to provide clarity and rationale. Observe that this is based on “IF” the client has doubts about assumptions, which means advisors do not need to burden clients with a detailed explanation of the assumptions if they are not in doubt of your ability to understand their goals and priorities." and "If the client asks you how their confidence is measured, this will require a careful explanation but it should not be focused on mathematics. Instead, the focus should be on the results of the math." And "If you fall into the red, above target zone, you are making needless sacrifices to your lifestyle...," meaning some clients may be spending more than they "should", if investment fees are not included in Envision plan target zone calculations. 90

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 90 of 144 126. When not including fees in the top chart, the portfolio allocation recommendation without investment fees shows an 88% chance of achieving Harold’s financial goals. The bottom chart shows the recommendation’s chances of meeting the financial goals is 29% with fees included.

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 91 of 144 127. The "Internal Use Only" document (0211-5064) also states "Although it may be unintended and clearly disclosed away, this report will serve as a guarantee (in the eyes of the client) of how reality should unfold. It illustrates what they should have in taxable assets in 2013, their tax bill in 2015 and their net portfolio withdrawal in 2020. No matter how many disclosures that are made, how else would you perceive this report if you were a client?" and "With the Envision process, the job is to focus on what matters: the client’s confidence and comfort in achieving the goals they value most. Presenting results that matter is what creates the confidence and comfort the client desires."

Clients have no expectations that the Envision program provides a guaranteed outcome.

Under no circumstances does Envision provide any guaranteed outcome to any client.

Gregory C. Keating Littler Mendelson Attorney representing Wells Fargo DOL/OSHA Position Statement April 17, 2013

128. Internal Wells Fargo Advisors web pages and documents say “For credit in the 4front program, the Financial Advisor must designate an Envision profile in the Household as the [Envision Plan of Record] (POR). This will identify the profile that was presented by the Financial Advisor and accepted by the client. This requires that the plan reflects the client’s goals and risk tolerance, that it remains within the Target Zone...or has been within or above the Target Zone within the past 12 months...”

129. For many Wells Fargo Advisers, there was no way to both get the bonus and include investment costs. Plaintiff qualified with 27 households. The minimum was 25.

To qualify for the 4front "retention" bonus, the black dot had to be above the bottom blue line, meaning the plan without investment fees would have qualified, while the other plan including fees wouldn't, meaning in overwhelmingly most cases, there was no way to both get the bonus and include investment fees.

130. Internal Wells Fargo Advisors web pages and documents say “The Envision Plan of Record (POR) review is a standard part of the Envision process and of 4front... Prior to granting a 4front Level One award, PORs will be reviewed to ensure that they have been presented to the client, reflect the client’s current goals and priorities, and have been or are in the process of being implemented.”

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 92 of 144 131. If “The overwhelming majority of Envision Plans do not include investment costs," many of the 98% of Wells Fargo Envision Plan clients cited in the following advertisement really don’t know where they stand in reaching their financial goals;

FINRA Rule 2210 also states “Information may be placed in a legend or footnote only in the event that such placement would not inhibit an investor's understanding of the communication. Members must ensure that statements are clear and not misleading within the context in which they are made, and that they provide balanced treatment of risks and potential benefits. ...Members must consider the nature of the audience to which the communication will be directed and must provide details and explanations appropriate to the audience. Communications may not predict or project performance, ...or make any exaggerated or unwarranted claim, opinion or forecast... Any comparison in retail communications between investments or services must disclose all material differences between them, including (as applicable) investment objectives, costs and expenses..." 93

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 93 of 144

132. Wells Fargo Advisors mandated Envision Plans of Record be updated annually, forcing Plaintiff and thousands of Advisers who didn't include investment fees to repetitively recommit fraud upon their clients in later years. Internal Wells Fargo Advisors web pages and documents say “To receive credit for the review/update of an existing plan, you must …conduct a thorough review of client goals and account information, ensure that everything is up to date and that your advice is current. If you discover that changes are needed, simply update the information, review accuracy and ensure that your advice is current and the plan is within or above the Target Zone. A new Client Presentation or Progress Report must be generated with the past 12 months...[and] the plan is presented to the client and reviewed on at least an annual basis”, the results of which show up on client statements, sent through the mail.

133. One of Plaintiff's assistants Mary Ann Godino agreed to create the Envision Plans for Plaintiff to earn the bonus. The next year Godino agreed to update them. In September 2012, Plaintiff didn't ask her to do it again after internally and externally whistleblowing and receiving the following email;

134. Internal Wells Fargo Advisors web pages and documents also say “...The Financial Adviser must keep their plans updated and continue serving their clients. On an ongoing basis, the plans will be reviewed ...and the plan must be continually adjusted so that it will keep the client on track towards achieving their goals. (This is measured by looking at whether the plan is within or above the Target Zone...)” Wells Fargo could also “cancel existing awards” and terminate for “failure to adhere to the guidelines”

135. Section 36 of the Investment Advisors Act of 1940 states "The Commission is authorized to bring an action...alleging that a person ...is about to engage in any act or practice constituting a breach of fiduciary duty involving personal misconduct in respect of any registered investment company for which such person so serves or acts, or at the time of the alleged misconduct, so served or acted — as ...investment adviser...”

“...the investment adviser … shall be deemed to have a fiduciary duty with respect to the receipt of compensation for services, or of payments of a material nature, paid by such registered investment company… to such investment adviser… An action may be brought … by the Commission...against such investment adviser... who has a fiduciary duty concerning such compensation or payments, for breach of fiduciary duty in respect of such compensation or payments paid by such registered investment company...to such investment adviser or person. …It shall not be necessary to allege or prove that any defendant engaged in personal misconduct, and the plaintiff shall have the burden of proving a breach of fiduciary duty."

136. From: George Hartzman To: [email protected], [email protected], [email protected], [email protected], [email protected], [email protected], [email protected], [email protected], [email protected], [email protected], [email protected] date: Sat, Jun 2, 2012 at 11:35 PM

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 94 of 144 subject: Hartzman’s Wells Fargo Whistleblower Filing, Page 30

"Regulatory capture occurs when a...regulatory agency created to act in the public interest instead acts in favor of the commercial or special interests that dominate in the industry or sector it is charged with regulating.

Regulatory capture is a form of government failure, as it can act as an encouragement for large firms to produce negative externalities.

...regulatory capture occurs because groups or individuals with a high-stakes interest in the outcome of policy or regulatory decisions can be expected to focus their resources and energies in attempting to gain the policy outcomes they prefer, while members of the public, each with only a tiny individual stake in the outcome, will ignore it altogether.

Regulatory capture refers to when this imbalance of focused resources devoted to a particular policy outcome is successful at "capturing" influence with the staff or commission members of the regulatory agency, so that the preferred policy outcomes of the special interest are implemented.

...A captured regulatory agency that serves the interests of its invested patrons with the power of the government behind it, is often worse than no regulation whatsoever."

Wikipedia

137. In the Matter of; George Hartzman, Complainant, v. Wells Fargo Advisors, LLC., Respondent, Case No. 2013-SOX-00045 with the United States Department of Labor, Office of Administrative Law Judges, presided over by Judge Kenneth A. Krantz, Wells Fargo declined to admit or deny the following discovery requests of February 27, 2014

Request for Admission 1;

Please admit or deny William Spivey and Aaron Landry's 2009, 2010 and 2011 compensation package metrics provided higher income by employing more Financial Advisors under their supervision with the same revenue production, and lower income by employing fewer Financial Advisors under their supervision with the same revenue production.

Request for Admission 4;

Please admit or deny that Littler Mendelson's Gregory C. Keating incorrectly stated, Wells Fargo's "Clients have no expectations that the Envision program provides a guaranteed outcome." and that Envision "price modeling is not included in Envision's default setting because:"..."(a) there are no products represented in Envision, only asset classes which are not associated with fees; (b) most plans include external assets which are held at other institutions such that the fees for those assets cannot be accurately included..." to the Department of Labor.

Request for Admission 5;

Please admit or deny that Wells Fargo Advisors could cancel existing 4front awards and claw back Financial Advisor 4front payments.

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 95 of 144 Request for Admission 6;

Please admit or deny that that on September 7, 2012, in front of 25 to 40 financial advisors at the Hyatt Regency St. Louis at The Arch, Greg Shiveley, Envision Sales Manager at Wells Fargo Advisors, said “There are 441,942 households with Envision Plans of Record.” and that Mr. Shiveley stated “The overwhelming majority of Envision Plans do not include investment costs."

Request for Admission 9;

Please admit or deny that William Spivey and Aaron Landry's 2009, and/or 2010 and/or 2011 compensation benefited by retaining Financial Advisors via Wells Fargo’s 4front program.

138. In the Matter of; George Hartzman, Complainant, v. Wells Fargo Advisors, LLC., Respondent, Case No. 2013-SOX-00045 Wells Fargo refused to admit or deny Envision plans created by Wells Fargo Advisors to qualify for 4front payments did not include investment costs;

"Request for Admission 10;

Please admit or deny whether or not the independent, third party review and determinations by an outside investigator/expert cited in George Hartzman’s July 23, 2013 final warning and in Wells Fargo council Gregory Keating’s written and signed communications with the Department of Labor found that most Envision plans created by Wells Fargo Advisors to qualify for 4front payments did not include investment costs."

The Request directly related to Wells Fargo’s handling and processing of Complainant’s whistleblowing activities involving what Hartzman reasonably believed to be illegal activity on Wells Fargo's part.

139. In the Matter of; George Hartzman, Complainant, v. Wells Fargo Advisors, LLC., Respondent, Case No. 2013-SOX-00045, Wells Fargo refused to provide answers to Interrogatories #1(a) – (k) and 2(a) – (k).

These Interrogatories request information about the Envision plans created by William Spivey and Envision plans supervised by William Spivey and Aaron Landry, who personally terminated Complainant.

These Interrogatories relate to details of created Envision plans that financially benefited William Spivey and Aaron Landry, who personally terminated Complainant for disseminating information as to how Landry and Spivey helped financial advisors, under their direct supervision, including Complainant and William Spivey for his own clients, mislead Wells Fargo clients under Landry and Spivey's direct supervision.

The subject of the email sent on September 10, 2012 cited by Wells Fargo as cause for Plaintiff's termination concerned Envision Plans created without including charged investment costs in projected minimum client goals for Wells Fargo clients.

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 96 of 144 It was Plaintiff's understanding before October 8, 2012, that William Spivey personally profited from Envision plans created for his clients without including charged investment costs in detailed long term projected minimum financial goals for his clients, for Spivey to qualify for Wells Fargo's 4front bonus.

It was Plaintiff's understanding before October 8, 2012, Spivey's Envision plans were annually updated without charged fees included in detailed long term projected minimum financial goals for his clients, which were and may still be included on Spivey's client statements.

Plaintiff contends Messrs. Spivey and Landry personally terminated him for disseminating information detailing how Spivey misled his clients, and how Landry and Spivey personally benefited from supervising financial advisors including Complainant, into misleading clients.

It was Plaintiff's understanding before October 8, 2012, that William Spivey and Aaron Landry personally profited/financially benefited by advocating and promoting their financial advisor workforce under Spivey and Landry's direct supervision, in the creation of Envision plans without including charged investment costs in detailed long term projected minimum financial goals for clients supervised by Landry and Spivey, including Complainant's and Spivey's, to qualify Spivey, and financial advisors supervised by Spivey and Landry, for Wells Fargo's 4front bonus.

It was Plaintiff's understanding before and after October 8, 2012, continuing into the present, William Spivey and Aaron Landry reviewed updates to the initially fraudulently created Envision plans without initiating actions to remove misleading long term projected minimum financial goals placed on monthly client statements sent through the mail, including Complainant's and Spivey's, and those supervised by Landry and Spivey.

Plaintiff asked for, and Wells Fargo refused to provide, Envision plan details directly related to what appears to be a motivation for retaliatory actions concerning Complainant's termination by Spivey and Landry, for Envision plans directly connected to Landry and Spivey.

Plaintiff alleges his statements about these Envision Plans constituted protected activity under the Sarbanes-Oxley Act and that Wells Fargo terminated him in retaliation for making said statements.

Interrogatory 1; William Spivey

A; Please provide the number, inception and update dates of Envision plans created to qualify for [payment via] Wells Fargo Advisors' 4front program, [between January 1, 2009 and October 8, 2012],

B; how many of the plans included investment costs and how many plans did not,

C; how many plans were updated with and without investment costs included,

D; how many household investment portfolios were adjusted to match Envision plan asset allocation recommendations within 90 days after inception,

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 97 of 144 E; how many household investment portfolios were adjusted to match Envision plan asset allocation recommendations within 90 days after being updated,

F; how many of the accounts with Envision plans created to qualify for Wells Fargo Advisors' 4front program were governed by the Investment Advisers Act of 1940,

G; how many of the accounts with Envision plans created to qualify for Wells Fargo Advisors' 4front program governed by the Investment Advisers Act of 1940 were created without investment costs included,

H; how many of the accounts with Envision plans created to qualify for Wells Fargo Advisors' 4front program, governed by the Investment Advisers Act of 1940 were updated without investment costs included,

I; how many accounts with Envision plans created to qualify for Wells Fargo Advisors' 4front program governed by the Investment Advisers Act of 1940 were created without the related accounts being adjusted to match the plan's asset allocation recommendations within 90 days of the creation,

J; how many accounts with Envision plans created to qualify for Wells Fargo Advisors' 4front program governed by the Investment Advisers Act of 1940 were updated without the related accounts being adjusted to match the plan's asset allocation recommendations within 90 days after the plans were updated,

K; and how many accounts with Envision plans created to qualify for Wells Fargo Advisors' 4front program governed by the Investment Advisers Act of 1940 were created and updated without the related accounts being adjusted to match the plan's asset allocation recommendations within 90 days after the plans were updated, by or for William Spivey, for William Spivey’s clients.

Interrogatory 2; William Spivey and Aaron Landry

A; Please provide the number, inception and update dates of Envision plans created to qualify for [payment via] Wells Fargo Advisors' 4front program, [between January 1, 2009 and October 8, 2012],

B; how many of the plans included investment costs and how many plans did not,

C; how many plans were updated with and without investment costs included,

D; how many household investment portfolios were adjusted to match Envision plan asset allocation recommendations within 90 days after inception,

E; how many household investment portfolios were adjusted to match Envision plan asset allocation recommendations within 90 days after being updated,

F; how many of the accounts with Envision plans created to qualify for Wells Fargo Advisors' 4front program were governed by the Investment Advisers Act of 1940,

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 98 of 144 H; how many of the accounts with Envision plans created to qualify for Wells Fargo Advisors' 4front program, governed by the Investment Advisers Act of 1940 were updated without investment costs included,

K; and how many accounts with Envision plans created to qualify for Wells Fargo Advisors' 4front program governed by the Investment Advisers Act of 1940 were created and updated without the related accounts being adjusted to match the plan's asset allocation recommendations within 90 days after the plans were updated, for Wells Fargo Advisors’ clients by Wells Fargo Advisors’ employees supervised by William Spivey and Aaron Landry.

140. If about 10,000 Wells Fargo Financial Advisors (FA) had to do a minimum of 25 Envision plans on households worth at least $250,000 to receive 4Front retention bonuses, and the average assets held by those households was/is about $450,000, and the average number of qualifying plans was about 35 per Advisor;

10,000 x 35 plans each = 350,000 Envision Plans x $450,000 of each household’s assets;

350,000 x $450,000 = $157,500,000,000 of other peoples money.

141. From: George Hartzman to: Jeff Horwitz

I have asked if the firm currently was borrowing the last rally. As we rise into the close, it occurred to me.

If they didn’t disclose last time and walked with he cash. Why not continue.

And the status quo gets to remain the same.

142. From Spivey, William Sent: Friday, June 15, 2012 3:17 PM To: Hartzman

George, as follow up to our conversation today, you must immediately take down any advertising or postings, such as found on eventbrite, regarding your upcoming CPA CPE events. ...In addition, you must cancel these existing events...

...Thanks for taking care of this.” Bill

William D. Spivey, Senior Vice-President/Investments Complex Branch Manager, 3623 North Elm Street, Ste 100A, Greensboro, NC 27455

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 99 of 144 from: george.hartzman to: william.spivey date: Sat, Jun 16, 2012 at 12:19 PM mailed-by: wellsfargoadvisors.com

“Done”

George Hartzman, Vice President-Investments, Fundamental Choice Portfolio Manager Wells Fargo Advisors LLC

143. From the information pages of my June 19, 21 and 26th, 2012 canceled classes, which 10,627 North Carolina CPAs received via email:

$99 - 8 hour CPA CPE: George Hartzman's Wells Fargo Whistleblower Filing and the Accounting Industry

Topics: Hartzman's Whistleblower Filing, Double Dip Recession?, Regulatory Capture, Sarbanes-Oxley, Bailout Ethics, China, European Economic Contagion, Dodd-Frank, Tax Ethics, Crony Capitalism, Chess, Regulatory Ethics, FASB, The Federal Reserve & Financial Market Intervention, Communication Ethics & What to Do Now.

Bloomberg, Nov 28, 2011; “Secret Fed Loans Gave Banks Undisclosed $13B

The Federal Reserve and the big banks fought for more than two years to keep details of the largest bailout in U.S. history a secret.

Bankers didn’t mention that they took tens of billions of dollars in emergency loans at the same time they were assuring investors their firms were healthy.”

Hartzman's Inquisition is an Intermediate / Advanced CPE Workshop, presented by Think Professional Education, a registered sponsor of continuing professional education with the North Carolina State Board of CPA Examiners. Sponsor #20110010

I believe Sarbanes–Oxley has been violated. I believe Wells Fargo's Ethics Code has been violated. I believe my client's best interests have been violated. I believe I provided my clients inaccurate information. I believe no one has been held accountable. I believe a select few profited from information my fiduciary clients lost money because of.

George Hartzman

Critical analysis and debate for CPAs in public accounting and industry. Each Attendee will receive a dated, numbered, and signed copy of Hartzman's Inquisition.

...“What Does It Mean to Be a Fiduciary? Fiduciary duty represents the highest degree of trust and confidence that the investment advisor will act in your best interest. As a fiduciary, your investment advisor has the duty to: Make full and fair disclosure of all material facts, particularly where the advisor’s interests may conflict with the client’s. Have a reasonable, independent basis for their investment advice. Be loyal to clients.”

Wells Fargo Advisors Client Approved Flier

George Hartzman, President of Think Professional Education, Based in Greensboro, NC, 100

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 100 of 144 specializes in economics and financial ethics and has taught North Carolina CPA CPE for Thirteen years.

"Under [The Sarbanes-Oxley Act], …public companies must promptly disclose information on material changes in their financial conditions or operations on a rapid and current basis (Section 409). Financial reports required to be prepared in accordance with GAAP must include all material correcting adjustments that have been identified by a public accounting firm, and in its annual and quarterly reports, (Section 401).

…pro forma financial information contained in a periodic report filed with the SEC, or in a press release or other public disclosure, will be required to be presented so as not to “contain an untrue statement” or omit the statement of a material fact necessary to make the pro forma financial statement not misleading. …Management’s public accountants will be required to attest to and report on the assessments made by company’s management.”

Rizvana Zameeruddin, Northeastern Illinois University...

144. From a public records request from the North Carolina Department of the Secretary of State Securities Division, after Plaintiff filed a compliant at the state level;

"FINRA & SEC Refferall - 2 isssues

6/15/12 - Reviewed complaint with Dan Stefek (Atlanta) - Will direct to Dan's attention

6/18/12 - Reviewed issues with Donna Esau [?] (SEC Atlanta) - Recommended to speak directly with Michael Mashburn (SEC Atlanta) Senior Council - understands TARP issues

6/20/12 - [left message for Mashburn] - missed return call

6/21/12 - Reviewed issues with Mashburn

Requested that complaint be sent directly to him."

Steven Butz Director – Investment Adviser & Broker Dealer Examinations North Carolina Secretary of State Securities Division

145. From: Spivey, William Sent: Tuesday, June 19, 2012 8:28 AM To: Hartzman, George

"Hey George, I have been instructed to inform you that you need to take down your blog. Please respond to me when you have complied with this request.

…the Firm prohibits company-related communication through these channels and requires that the Associate not use the Firm’s name or his or her affiliation with the Firm. Any and all securities related communication even if conducted on an associate’s own time, is subject to the general regulatory standards and associates should be cautious of what and how they communicate. ...Thanks." Bill

101

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 101 of 144

146. From: Hank Sanchez @oysterllc.com To: George Hartzman

Date: Mon, Jul 9, 2012 at 7:30 AM subject: Some follow up questions

Hi - I hope your trip and time off went well.

As I indicated when we met, I would probably have some follow up questions once I had a chance to get through my thoughts about our discussions last Monday. Those questions are below. I’d be happy to go through them with you during another phone call, or you can address them in writing in a response e-mail to me- whichever you prefer. Thank you in advance for your continued cooperation.

When did you file (dates) the two ethics complaints, one regarding the secret loans and the other regarding Envision℠ with Wells Fargo?

Do you have copies of the complaints and responses, if any? Please provide.

What is the exact date of the Whistleblower Complaint with the SEC? Please provide a copy of any responses.

Regarding Complaints filed with FINRA, the State of NC and others, on what dates were those filed? Specifically, please provide a list of names/titles to who you filed the complaints. Please provide copies.

Please provide copies of all responses received from the various places where complaints were filed.

You indicated that you had refused the 4Front bonus- can you provide documentation that shows that (a) how the program was to work, (b) that you met the goals set by the program, and, (c) that you were offered the bonus and refused it?

...You also indicated that Wells found out that advisors were completing plans so fast that it was clear that they were not meeting with clients- do you have any documentation that can show this? Do you have any documentation that would evidence that it was communicated by Wells to advisors to not complete plans so quickly? When did this communication take place- date? How was it communicated?

102

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 102 of 144 147. From: George Hartzman to: bcc: Matthew Evans, Jeff Horwitz, [email protected], [email protected], [email protected], [email protected], [email protected], [email protected], [email protected] Date: Thu, Jul 12, 2012 at 1:26 PM subject: Fund Flows

How is it that the market went up even if money was being withdrawn?

Source: Zero Hedge

148. From: Date: Tue, Jul 17, 2012 at 9:21 AM To: william.spivey Cc: hank.sanchez@oyster

Sent to the United States Senate Committee on Banking, Housing & Urban Affairs and the US Congressional House Committee on Financial Services on Sunday, July 15th, 2012

Forwarded to Michael Mashburn, SEC and Daniel Stefek, FINRA - both of whom received NC Securities Division File No. 12 SEC 84, in late June, who spoke with George Hartzman during the second week of July http://hartzman.blogspot.com/2012/07/forwarded-to-michael-mashburn-sec-and.html

From a public records request of George Hartzman's Wells Fargo NC whistleblower filing http://hartzman.blogspot.com/2012/07/from-public-records-request-of-george.html

The potential enormity of George Hartzman's Wells Fargo Whistleblower filing on Envision Investment Plans and 4front http://hartzman.blogspot.com/2012/07/potential-enormity-of-george-hartzmans.html 103

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 103 of 144

149. Wells Fargo’s response to having a guest at a conference call with Hank Sanchez, Meaning Wells Fargo told me I couldn't have an attorney at the meeting. I received a formal warning the following Monday morning, at which Hank Sanchez refused to disclose any verbal or written the evidence behind his finding that my issues had no merit. The report and discussion of its contents is filed under seal per Defendant's request;

From: Spivey, William Sent: Friday, July 20, 2012 11:36 AM To: Hartzman, George

Subject: Here is your response...

“Third-Party Representation; It is the intent of all Wells Fargo policies to provide a productive and respectful work environment. We respect your right to communicate directly, on an individual basis, with your manager, your manager's manager, or your HR professional about any of the terms or conditions of your employment. Within our work environment, we believe that those who are also Wells Fargo team members can be more responsive to your needs and concerns than anyone outside of the company, such as an attorney, labor organization, association, or group. For that reason, we conduct team member communications and problem-solving, as well as performance counseling, corrective action, and internal investigations, without participation by an individual or a “representative” who is not a Wells Fargo team member. Confidential information relating to employment should be discussed only between the team member and his or her manager, or another authorized Wells Fargo team member.

If you encounter any problems on the job, bring your concerns to your manager or your HR professional. They’re willing to discuss any work-related problem, issue, or concern with you on a direct, person-to-person basis.”

150. I met with bill and the investigator on Friday afternoon and refused to provide the report justifying the Final Warning they gave me on the following Monday morning;

From: Spivey, William Sent: Monday, July 23, 2012 2:54 PM To: Hartzman, George

Subject: RE: Please provide explanations

George, As explained in the Final Warning, you have not been terminated. You have received a Final Warning because of your continued violation of Firm policies, despite repeated warnings. The Final Warning is not related to the complaints you have raised and which the Firm and an independent consultant have determined to be without merit.

Sincerely, Bill . From: Hartzman, George Sent: Monday, July 23, 2012 3:08 PM To: Spivey, William

Subject: RE: Please provide explanations

"The Final Warning is not related to the complaints you have raised and which the Firm and an independent consultant have determined to be without merit."

104

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 104 of 144 How can it not be related if all the information I just took down was all and only about complaints I have raised? George Hartzman

151. According to the privilege log provided by Wells Fargo, listed as Attorney-Client Privilege, between 7/17/2012 and 7/25/2012, there were 13 emails involving Senior Counsel Phil Toben, Assistant General Counsel John Anderson, Managing Director/Market Manager Aaron Landry, William Spivey and WFA Regional President William Rogers.

Six of the emails were titled "Final Warning".

One was titled "The Sarbanes-Oxley Act"

Mr. Hartzman does not identify any specific reporting practice by Wells Fargo with respect to these "secret" loans that he alleges to be false or misleading.

Second, Mr. Hartzman's vague allegations simply have no merit.

...Mr. Hartzman has not specified any securities law disclosure requirement regarding any loans from the Federal Reserve.

... it does not constitute protected activity because it does not concern any actual securities law violation."

Gregory Keating Littler Mendelson Attorney representing Wells Fargo DOL/OSHA Position Statement April 17, 2013 152. From: george.hartzman Date: Thu, Jul 26, 2012 at 12:44 PM Subject: On the independent investigator Hank Sanchez To: [email protected]

Please provide a track record for Hank Sanchez off Oyster Consulting for cases he has investigated, detailing the percentage of cases in which Hank sided with those who paid him to investigate, and the percentage of cases in which he sided with the party being investigated, as well as how Oyster consulting's percentages as a whole on the same information.

George Hartzman

153. In the Matter of; George Hartzman, Complainant, v. Wells Fargo Advisors, LLC., Respondent, Case No. 2013-SOX-00045 Wells Fargo refused to admit or deny that on Friday, July 20, 2012, William Spivey informed George Hartzman he was not allowed to have a guest at a meeting with an outside investigator concerning his ethics issues.

Request for Admission 7;

Please admit or deny that that on Friday, July 20, 2012, William Spivey informed George Hartzman he was not allowed to have a guest at a meeting with an outside investigator concerning his ethics issues.

105

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 105 of 144 The request directly relates to Wells Fargo’s handling and processing of Plaintiff’s whistleblowing activities involving what Hartzman reasonably believed to be illegal activity on Wells Fargo’s part.

Request for Admission number seven seeks an admission that on Friday, June 20, 2012, William Spivey informed Plaintiff that he was not permitted to invite a guest to a meeting with an outside investigator concerning Oyster Consulting's report on Plaintiff's whistleblowing allegations, which didn't include the actual report, but a verbal rendering by Hank Sanchez. The admission responsive to the request is relevant to Plaintiff’s retaliation claim under the Sarbanes-Oxley Act in that it directly deals with corrective action Wells Fargo took against him. The report and discussion is being filed under seal along with this complaint.

154. From: George Hartzman to: [email protected], bcc: [email protected], [email protected], [email protected], [email protected], [email protected], [email protected], Amanda Lehmert, Joe Killian, Allen Johnson, Matthew Evans, Jeff Horwitz, Jeff Gauger

Date: Mon, Jul 30, 2012 at 10:57 PM Subject: Re: your inquiry today

I have internal use info that was up on a website that is evidence, that I was told to take down or be fired. I was also told in writing not to give it to anyone. They were fine with illegally firing me because it would have to go civil, and I would be out of the system and out of a job. The way it reads that includes not giving the info to FINRA or the SEC.

Mr. Craig has done nothing.

Mr. Craig talked on the phone with me once, and then did nothing.

Four months and counting I think.

The SOPs of the SEC and FINRA leave those like me helpless and unknowing.

Is Mr. Craig's case still open? Why no follow up?

I found banks that reported the loans, and others who didn't.

For how long has FINRA known that?

How long has FINRA known about Envision and 4front?

How long has FINRA let the financial industry lie to the people your agency is supposed to protect?

I have almost been fired three times, I have a daughter going to college in a few days, I can't make money, I have been trying to do the right thing and the response from FINRA has been 0.

Sorry to unload on you Joan, but this is ridiculous.

I need someone to stand up other than myself.

My understanding is that it is FINRA's job to do so, and FINRA has failed so far. gh

106

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 106 of 144 155. As I couldn’t open new accounts, and didn’t know if the bank or any others were still taking loans, I borrowed money from my 401k to get by on less income;

From:

“Loan Request Confirmation

Loan ID Loan Amount Application Date Status Action

$42,400.00 08/01/2012 Processing

Interest Rate 5.25% Frequency Bi-Weekly Estimated Payment; $371.26”

George Hartzman

156. In the Matter of; George Hartzman, Complainant, v. Wells Fargo Advisors, LLC., Respondent, Case No. 2013-SOX-00045 with the United States Department of Labor, Office of Administrative Law Judges, presided over by Judge Kenneth A. Krantz, Wells Fargo declined to admit or deny the following discovery requests of February 27, 2014

Request for Admission 8;

Please admit or deny that Wells Fargo management was aware of George Hartzman’s 401k loan, which defaulted after Mr. Hartzman’s termination.

157. Congressman Howard Coble's Kirk Bell;

Bell, Kirk [email protected] Jul 31 2012 to me

“George – I hope all is well. I wanted to contact you and let you know I am available if you want to discuss information regarding the Federal Reserve. If you want to provide a phone number, I can call at your convenience. Let me know if we can be of service.”

Thanks,

W. Kirk Bell, Sr. Legislative Assistant, Rep. Howard Coble, NC 6th . George Hartzman Jul 31 to Kirk

Absolutely. Name time and place. Will have to send a few things beforehand. . from: George Hartzman to: "Bell, Kirk" bcc: [email protected], [email protected], [email protected], [email protected], [email protected], [email protected], [email protected]; date: Fri, Aug 3, 2012 at 12:03 PM subject: Incoming info - The links that don't work are one's I had to take down last Friday. Please call with questions.

“These are the secret loans. If they were not secret, I would think Bloomberg News wouldn't call them secret. I found some small banks governed by the North Carolina Commissioner of Banks did report the loans correctly.

I manage discretionary money in advisory accounts. I have a legal fiduciary obligation to 107

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 107 of 144 my clients. I didn't know because they didn't report what they should have, therefore I gave wrong advice because who I work for lied, thus violating SARBOX etc... Still unknown was the size of the credit lines, and the interest rates and whether or not the banks still have access or are using lines of credit.

Did Wells Fargo CEO John G. Stumpf profit from stock and option compensation while not disclosing material information?” . 158. from: George Hartzman to: "Bell, Kirk" date: Fri, Aug 3, 2012 at 12:10 PM subject: On People's Bank of NC and BB&T. People's reported, BBT didn't… . 159. from: George Hartzman to: "Bell, Kirk" date: Fri, Aug 3, 2012 at 12:45 PM subject: Harry Markopolos - Bernie Madoff

“In front of the House Financial Services Committee hearing, the former investment manager told how his nine years of repeated warnings to SEC enforcement officials went ignored and how they dismissed his detailed "red flag" reports.

Madoff Whistleblower: SEC Failed To Do The Math; “It was redemption of a sort for Harry Markopolos, ...who spent nearly a decade on Madoff's trail — and whose warnings were largely ignored by securities regulators.” http://www.sec.gov/news/studies/2009/oig-509.pdf

“Madoff whistleblower blasts SEC; A whistleblower who repeatedly warned the Securities and Exchange Commission that Bernard Madoff was perpetrating a massive investment fraud testified Wednesday that the regulatory agency that oversees financial markets is inept, "financially illiterate" and far too cozy with the financial titans it is supposed to be regulating.

“The SEC is also captive to the industry it regulates and it is afraid of bringing big cases against the largest most powerful firms…

Cleary the SEC was afraid of Mr. Madoff."

Harry Markopolos

“After at first receiving an encouraging reception from the SEC's Boston Bureau Chief, Edward Manion, Markopolos said the New York SEC office, which supervised Boston, blocked a further investigation. Markopolos said the SEC is in need of a major overhaul.

Senior managers should be replaced, lawyers should be separated from financial investigators, and the agency should hire employees who have years of Wall Street experience, he said.”

160. Bell, Kirk [email protected] Aug 22 to me

“George – I hope all is well. I am still working on this. I will let you know how things are moving along. Thanks,” W. Kirk Bell . George Hartzman Aug 22 to Kirk;

108

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 108 of 144 “Actions and words. Two different things. Have I gone through the stuff with you yet?” . Bell, Kirk [email protected] Aug 22 to me;

“George – One of the apprehensions I have is that I am not sure what you need from us. I will gladly try to help guide you, but our office handles legislative concerns. If this information is accurate, and I am not doubting it is, there is a serious problem. However, we are not a law enforcement agency. We cannot require an agency to consider or not consider your information. You will probably be better served by contacting the FBI or SEC. If there is anything we can do in a legislative capacity, please do not hesitate to let me know. Thanks,” W. Kirk Bell . George Hartzman Aug 22 to Kirk;

“Then what did you mean when you said you were working on it? If Howard comes out and has a press conference asking for some accountability, that would be great. Let me know. That's what I am looking for. Someone to step up and say something. To actually do something. If not, you will have chosen to do nothing, and hopefully will be held to account.” . Bell, Kirk Aug 22 to me; “George – I was trying to find out if there was anything I could do to help. My suggestion is that you contact a law enforcement agency. Thanks,”

W. Kirk Bell, Sr. Legislative Assistant, Rep. Howard Coble, NC 6th

Date: Wed, Aug 1, 2012 at 2:13 PM Subject: Wells Fargo Internal Use Only Information Number 1, discussed with FINRA office of the Whistleblower Brian Craig and Tony Cavallaro

After speaking today with Brian Craig, Associate Director at FINRA and Tony Cavallaro, Vice President, FINRA, I am attaching documents taken offline last Friday which contain evidence concerning George Hartzman's Whistleblower filing and Wells Fargo Advisors, which was discussed with Mr. Craig in March and apparently was never followed up on.

Daniel Stefek, FINRA Atlanta has received the file from the North Carolina Securities Division filed by Steven Butz, Director – Investment Adviser & Broker Dealer 109

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 109 of 144 Examinations North Carolina Secretary of State Securities Division.

Howard Coble's, Brad Miller's and Kay Hagan's offices have been contacted as well as the Congressional Financial Services Committee and the North Carolina Commissioner of Banks.

As discussed with Messrs Craig and Cavallaro, a follow up discussion is supposed to take place after they have reviewed this new evidence of which they were unaware of until today, which could mean my situation has been un-monitored by those who most would think supposed to do so.

These documents need explanation.

I apologize for being abrasive, but getting the run around by a regulatory system that is supposed to help is very disturbing. Regulators of whom investor tax money pays for via passed through fees from broker dealers and central government general fund allocation should probably not treat someone who is trying to do the right thing poorly, like not saying whether the case is closed or not, and not saying anyone will ever get back to follow up and not doing anything with information received months ago and then suddenly regaining interest when pressure was applied.

Please don't assume I trust those who have been charged with standing up for the little people, because actions of said federal agencies etc... have been pretty negligent thus far. Please forward to Brian and Tony. More on the way.

Date: Thu, Aug 2, 2012 at 1:54 PM Subject: If Union Bank and Trust in Oxford, NC disclosed Federal Reserve loans Wells Fargo didn't, how did Wells Fargo not violate Sarbanes Oxley?

163. From: George Hartzman to: [email protected], Mary.McCollough@greensboro- nc.gov, [email protected], [email protected], [email protected], [email protected], [email protected], [email protected], zack.matheny@greensboro- nc.gov, [email protected], [email protected], [email protected], [email protected], [email protected], [email protected], [email protected], [email protected], 110

Date: Thu, Aug 2, 2012 at 7:00 PM

Subject: George Hartzman Whistleblower evidence for Michael Mashburn and Justin C. Jeffries, SEC Atlanta.

If Peoples Bank of North Carolina's CEO Tony Wolfe decided to sign off on SEC reports stating Federal Reserve Borrowings, did BB&T?

Wells Fargo only different.

This information has been received by the North Carolina Commissioner of Banks.

I spoke with Ray Grace, Acting Commissioner two Friday's ago.

This is a North Carolina issue as well as national, but no North Carolina News outlets will report on what they should?

Should one North Carolina regulated bank report what another doesn't if not reporting what should have been was illegal?

How is this not an anti-competitive practice condoned by regulatory authorities and ignored by North Carolina's for profit press?

How are North Carolina journalists who know of this information not complicit in not disseminating truth?

The Greensboro News & Record knows. Triad Business Journal knows. The Charlotte Observer knows. Why would our news outlets omit material information?

Is it the same reason national outlets are doing the same thing?

Is our press partly responsible for this lack of accountability?

Where are our elected leaders?

Where are our regulators?

Where are the CPA's?

Was everything I taught for the last decade meaningless? 111

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 111 of 144

164. An email sent via Constant Contact on 08/28/2012 around 10:56 AM EDT concerning Warren Buffett, who owned 9.2% of Wells Fargo in 2007; http://wallstcheatsheet.com/stocks/4-reasons-warren-buffett-loves-wells-fargo-more-than- any-other-stock.html/?a=viewall

Subject: FBI Economic Crimes Unit, Insider Trading Evidence - Berkshire Hathaway's Warren Buffett

If Warren Buffett knew of Federal Reserve provided secret loans to Goldman Sachs and General Electric including total available credit line, collateral, loan size, interest rate and terms, how did Mr. Buffet not invest in Goldman Sachs and General Electric with material information most everyone else didn't know?

..."Goldman Sachs Group, Inc. (NYSE: GS) announced today that it has reached an agreement to sell $5 billion of perpetual preferred stock to Berkshire Hathaway, Inc. in a private offering. In conjunction with this offering, Berkshire Hathaway will also receive warrants to purchase $5 billion of common stock...

In addition, Goldman Sachs is raising at least $2.5 billion in common equity in a public offering.

We view it as a strong validation of our client franchise and future prospects," said Lloyd C. Blankfein, Chairman and CEO of The Goldman Sachs Group, Inc.”

September 23, 2008 Statements by high officials are practically always misleading when they are designed to bolster a falling market.

Gerald Loeb

"This investment will further bolster our strong capitalization and liquidity position."

Goldman Sachs Press Release... If you choose not to know something, especially if that something is something you should know, you are morally blameworthy.

Robert Lawry Director of the Center for Professional Ethics

...Could a moment when most understand what few knew be more important than the first discovery?

165. On Saturday, September 08, 2012, at 7:19 AM, two days before September 10, 2012, when Complainant sent an Envision related email Respondent cites for termination, I received the "Envision Plan of Record (POR) Policy Status Report" via email telling Plaintiff to recommit fraud, which stated;

"In early June an enhanced policy for Envision PORs was announced. The new policy states that for a plan to maintain POR status: •A client presentation must have been generated and presented to the client within the past 12 months and

112

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 112 of 144 •The POR Plan Result may not score lower than the Target Zone (<75) for 12 consecutive months.

If a plan is not brought into compliance within 14 months, based on last presentation date or the last date the plan had a score in the Target Zone, the Firm will deselect the plan as a POR. Please note that the Envision plan will remain in the system, but the POR designation will be removed."

113

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 113 of 144

At the time Plaintiff received the POR report, which was after Plaintiff went public with the information in June, 2012, Wells Fargo stated it could recoup the outstanding balance of a $42,862.68 4front retention bonus earned via fraudulently created Envision plans; The above report was a direct cause of the September 10, 2012 email showing how Envision plans were rigged to qualify for 4front bonuses, which led to Plaintiff's termination. I was being asked to recommit fraud on clients with accounts under the Advisors Act and I didn't have the money to pay Wells Fargo if they initiated a claw back.

166. Mr. Spivey was known to personally meet with Advisors who didn't update their plans to make sure that they did and that "The POR Plan Result may not score lower than the Target Zone (<75) for 12 consecutive months", which means Spivey, under the supervision of Aaron Landry, coerced Advisors to recommit fraud upon clients with accounts governed by the Advisors Act.

Plaintiff contends that refusing to play along was directly correlated to adverse actions by Spivey, Landry and Wells Fargo, which provided motive by Spivey and Landry to terminate Plaintiff, as a termination as opposed to a claw back may have positively affected their compensation, which Wells Fargo refused to provide evidence of.

167. From the email Plaintiff sent on September 10, 2012, for which Wells Fargo alleges he was fired for sending, which became a public record upon dissemination;

The following shows how financial plans can be manipulated to sell clients and prospects on new investment ideas or staying on a current course with a financial advisor.

If some financial estimates and hypothetical illustrations exclude perpetual levels of data, some information be manipulated to show what may not be true to benefit a few at the expense of many. It is difficult to get a man to understand something, when his salary depends on his not understanding it.

Upton Sinclair

This information is being emailed to the Federal Reserve Board, Financial Industry Regulatory Authority (FINRA), Securities and Exchange Commission, North Carolina Department of Insurance, North Carolina Department of Justice, Federal Trade Commission, Carolina Secretary of State, Securities Division, Financial Accounting Standards Board, the FBI, American Institute of Certified Public Accountants (AICPA), North Carolina Association of Certified Public Accountants (NCACPA), Consumer Financial Protection Bureau, Public Company Accounting Oversight Board, and the North Consumer Financial Protection Bureau among others.

The example I am using to illustrate this phenomenon involves Wells Fargo's Envision Plans.

I am currently employed with Wells Fargo Advisors in Greensboro, North Carolina.

I have taught the North Carolina CPA Continuing Education Ethics Component.

114

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 114 of 144 I have taught the North Carolina Bar Association Ethics CE.

Many well known retail brokerages and investment firms do relatively the same thing, only different.

That the US regulatory infrastructure has done nothing for more than seven months seems revealing, considering the lack of accountability and prosecutions of Wall Street after 2008.

Not one for-profit news organization has reported this story.

A possible reason is the US regulators assigned to this issue as well as any other whistleblower case, won't say whether a case is closed or not, won't say anyone will ever get back to follow up or not, and won't confirm to the press whether or not an investigation is in progress.

For someone who chose to not be a fraud while teaching ethics, I feel as though I have been betrayed by many who earn taxpayer money to keep free market capitalism accountable.

The lack of any confirmation also means my family, friends and coworkers don't know if I am being truthful or not and/or otherwise.

Since first going public with this information in mid June, 2012 after little success with Wells Fargo and our nation's regulatory industry, I have been blacklisted from being able to teach the North Carolina CPA Continuing Education Ethics Component, by the NC State Board of CPA Examiners, which is being appealed to the NC Office of Administrative Hearings.

I began this journey in December, 2012.

I believe I am doing the right thing.

Time for some who can investigate and disseminate to do the same.

I am running out of courage in the face of such apathy.

Please help. George Hartzman

168. Wachovia Securities executives who visited the Greensboro’s 3623 North Elm Street Branch told a meeting of brokers that the 4front program was set up to avoid critical press reports about TARP being money used to “retain” financial advisors.

Reps were told “do the plans and get paid.”

When the first round of Envision plans were created, word came down from executive management imploring our office to not create too many Envision plans at the same time to keep up appearances.

Wells Fargo Advisors and Wells Fargo executive management defrauded the government by using TARP and TAF money to retain brokers. If Wachovia had disclosed the TAF loans when they should have, the company’s stock price would most likely not have fallen as much as it did. If the stock hadn’t fallen as much, the buyout may have never occurred, and if it did, Wachovia shareholders would most likely have received a better price.

TAF loan disclosure = No TARP = No 4front bonuses paid for with TARP money. 115

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 115 of 144 169. From: George Hartzman bcc: [email protected], [email protected], [email protected], Amanda Lehmert, Jeff Horwitz, Jeff Gauger, Joe Killian, Brian Clarey, [email protected], [email protected], richard.barron, adunn@charlotteobserver, Zack Matheny, [email protected], dgclark@news- record.com, Denise.Turner@greensboro, Karl Denninger

Date: Mon, Sep 24, 2012 at 1:42 PM subject: I take this to mean the issue is under investigation.

This issue has gone from FINRA office of the whistleblower to the NC Secretary of State, Securities Division who referred the case to Atlanta FINRA, which sent it back to DC, who sent it to Kansas City FINRA.

I was on a conference call a few weeks back with about 8 people on the line.

We went through the above attachment.

Anybody feel like reporting a national story yet? . From: [email protected] Cc: "Varvel, Bryan" [email protected]

George:

I have received this information you provided. I will be ensure our assigned examiner also receives the information to help with his investigation. He may be in touch if he has questions.

Thanks

Jennifer Anne Luginbill Associate Director Kansas City District Office FINRA 120 W. 12th Street, Suite 800 Kansas Ciy, MO 64105

170. Plaintiff's employment at Wells Fargo Advisors was terminated on Monday, October 8, 2012 in direct retaliation for disseminating whistleblower information that our regulatory infrastructure seems unwilling to act upon and our mass media won’t report. My “U5” states “Termination Explanation: Violation of the firm’s policies, including policies prohibiting the disclosure of the firm’s proprietary and/or internal use only information”.

171. From: George Hartzman to: "Luginbill, Jennifer" , [email protected], [email protected], [email protected] bcc: Jeff Gauger, Jeff Horwitz, Joe Killian, Amanda Lehmert, Matthew Evans, msutter

Date: Tue, Oct 9, 2012 at 4:27 PM

Subject: Fwd: FW: September 2012 Status Report - Envision Plan of Record Policy

As you may know, I was terminated yesterday.

I believe my family is in danger as long as this isn't public.

116

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 116 of 144 The purpose of these documents were meant for me to redo the fraud already committed, therefore, all the others sent out to other brokers were meant to continue the fraud.

Please do something.

This is ongoing. gh

172;

117

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 117 of 144 118

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 118 of 144 173. After Spivey and Landry terminated Plaintiff for what all three of us were personally involved in, Plaintiff contacted some former clients to have them ask;

"[email protected] Oct 17 to william.spivey

Dear Mr. Bill Spivey,

Please provide a copy of all historical Envision Plans of Record, including the Investment Plan Assumptions, and Target Zone-Long Term pages.

If investment costs are not included, please provide an "apples to apples" comparison of the last Envision Plan of Record, using asset values and investment costs at that time.

Please do not involve my current broker.

Sincerely,..."

What they received were previously completed Envision plans and the letter below.

Wells Fargo chose not to provide an “apples to apples’ plan including investment costs as asked for, without consequence from FINRA, the SEC or the FBI etc...;

174. By filing a Wells Fargo Ethics Line complaint concerning Envision, I accused both William Spivey and Aaron Landry of violating, and/or supervising the violation of the Investment Advisors Act of 1940 to game compensation via 4front for their personal benefit, which provided them motive to retaliate and/or terminate Plaintiff.

Spivey and Landry retained/increased their income by supervising their financial advisors to create inaccurate Envision plans for Wells Fargo clients, which indicates they had cause and motivation to retaliate against and/or terminate Plaintiff. 119

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 119 of 144

Messrs. Spivey and Landry personally terminated Hartzman for disseminating information detailing how Spivey misled his clients, and how Landry and Spivey personally benefited from supervising financial advisors including Complainant, into misleading clients, which makes the information proving Landry and Spivey did so relevant to retaliatory motive.

175. From: George Hartzman to: [email protected], Luginbill, Jennifer, [email protected], [email protected], Jeff Horwitz, Matthew Evans, Mark Sutter, Jeff Gauger, William Cohan, James Howard Kunstler, Karl Denninger, Joy Clairmont, [email protected], [email protected]

Date: Tue, Oct 23, 2012 at 10:20 AM Subject: 401k loan

Now that I am not working for Wells after being fired for whistleblowing, my 401k loan I am keeping my family afloat with will have to be paid back Q1 2013.

Direct retaliation.

Add that to the $35k they want back for what I blew the whistle for.

I would like to be able to tell my wife something.

Not one news outlet will run the story.

My life is in danger as long as it remains under seal.

My family is in danger.

This is not what should have happened to someone trying to do the right thing.

I keep hearing about what the policy is on not commenting about ongoing investigations, but there has to be something someone will do to remove the risks to my family.

Most would think this wouldn't happen in America. gh

176. On discovering whether or not the failures to disclose were actionable violations;

FYI From: Matthew Taibbi To: george hartzman Fri, November 30, 2012 10:29:49 AM

George just FYI -- I've talked to several prominent securities lawyers and some former congressional aides and you will be interested to know that nobody knows the answer to whether or not the failure to disclose secret Fed lending constitutes an actionable violation.

The issue, it seems, has not come up before.

One former Senate aide put it this way: "It certainly sounds like an omission of a material fact, but I doubt there's any precedent which establishes that it's a violation, especially when the Fed itself has a policy of keeping it secret (access to the Fed window undermines confidence in the bank)." . Re: FYI From: Matt Taibbi To: george Hartzman

Ok we're getting warmer. I just talked to one of the top securities lawyers in DC. When asked if this is a material violation, he said "How could it not be?" I want to show him an 120

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 120 of 144 example of a bank that disclosed. What was that NC bank again you mentioned? Could you send me the 10K (if you haven't already)? . Re: Another Broker From: Matt Taibbi To: george Hartzman

George, So I've been doing a lot of work on your stuff. I had a conference call with Chase and a Treasury official on the disclosure issue. I also spoke with the former chief accountant of the SEC. …In short the people who are more believable are in agreement with you. The banks' argument is that the info is not material. But my SEC guy does not agree. . George, here's what my ex-SEC friends sent me: http://gibsondunn.com/Publications/Pages/DisclosureConsiderationsInTurbulentTimes.aspx http://www.sec.gov/rules/interp/33-6835.htm

...check the 1989 guideline out. The passage that's most relevant reads:

"If these or any other types of federal financial assistance have materially affected, or are reasonably likely to have a material future effect upon, financial condition or results of operations, the MD&A should provide disclosure of the nature, amounts, and effects of such assistance." . From: Matthew Taibbi To: george hartzman;

…You know that stock purchase of Dimon's you sent to me? Do you have any other examples of him buying stock? That particular purchase was a bit unique and hard to unravel legally. They were preferred shares not sold to him by the company. Our lawyers are a little weirded out by it. How do I look up his other purchases? I know I should know this -- it's embarrassing, but trust me, it will help. Anyway, thanks again, and I'll talk to you soon,

Matt

177. Rolling Stone's Matt Taibbi "Secret and Lies of the Bailout", January 4, 2013;

"...The public has been lied to so shamelessly and so often in the course of the past four years that the failure to tell the truth to the general populace has become a kind of baked-in, official feature of the financial rescue. Money wasn't the only thing the government gave Wall Street – it also conferred the right to hide the truth from the rest of us.

...There were lies told in the first moments of their inception, and others still being told four years later. The lies, in fact, were the most important mechanisms of the bailout.

...instead of using the bailout money as promised – to jump-start the economy – Wall Street used the funds to make the economy more dangerous. From the start, taxpayer money was used to subsidize a string of finance mergers, from the Chase-Bear Stearns deal to the Wells Fargo- Wachovia merger to Bank of America's acquisition of Merrill Lynch. Aided by bailout funds, being Too Big to Fail was suddenly Too Good to Pass Up.

...The bailout ended up being much bigger than anyone expected, expanded far beyond TARP to include more obscure (and in some cases far larger) programs with names like TALF, TAF, PPIP and TLGP.

121

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 121 of 144 ...Goldman Sachs, which had made such a big show of being reluctant about accepting $10 billion in TARP money, was quick to cash in on the secret loans being offered by the Fed. By the end of 2008, Goldman had snarfed up $34 billion in federal loans – and it was paying an interest rate of as low as just 0.01 percent for the huge cash infusion. Yet that funding was never disclosed to shareholders or taxpayers, a fact Goldman confirms. "We did not disclose the amount of our participation in the two programs you identify," says Goldman spokesman Michael Duvally.

...Meanwhile, at the same moment that leading banks were taking trillions in secret loans from the Fed, top officials at those firms were buying up stock in their companies, privy to insider info that was not available to the public at large. Stephen Friedman, a Goldman director who was also chairman of the New York Fed, bought more than $4 million of Goldman stock over a five-week period in December 2008 and January 2009 – years before the extent of the firm's lifeline from the Fed was made public. Citigroup CEO Vikram Pandit bought nearly $7 million in Citi stock in November 2008, just as his firm was secretly taking out $99.5 billion in Fed loans. Jamie Dimon bought more than $11 million in Chase stock in early 2009, at a time when his firm was receiving as much as $60 billion in secret Fed loans.

...The stock purchases by America's top bankers raise serious questions of insider trading. Two former high-ranking financial regulators tell Rolling Stone that the secret loans were likely subject to a 1989 guideline, issued by the Securities and Exchange Commission in the heat of the savings and loan crisis, which said that financial institutions should disclose the "nature, amounts and effects" of any government aid. At the end of 2011, in fact, the SEC sent letters to Citigroup, Chase, Goldman Sachs, Bank of America and Wells Fargo asking them why they hadn't fully disclosed their secret borrowing. All five megabanks essentially replied, to varying degrees of absurdity, that their massive borrowing from the Fed was not "material," or that the piecemeal disclosure they had engaged in was adequate. ...According to the banks, it's none of your business if those same CEOs are making use of a secret $50 billion charge card from the Fed.

...The broader and more pressing concern is the clear implication that by failing to act, federal regulators- have tacitly approved the nondisclosure.

...The bailout has ...made lying on behalf of our biggest and most corrupt banks the official policy of the United States government." http://www.rollingstone.com/politics/news/secret-and-lies-of-the-bailout- 20130104?print=true

178. On January 22, 2013, Lanny Breuer, Assistant Attorney General, admitted to purposefully not pursuing illegality after choosing not to criminally indict HSBC executives for laundering drug money and enabling terrorist financing.

179. From the Examiner's Ken Shortgen Jr. on January 29, 2013; "In the public eye, one of the most egregious acts that took place in the banking industry after the 2007/2008 credit crisis, and taxpayer funded bank bailouts, was the size of the bonuses given to 122

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 122 of 144 executives, even as their policies drove several institutions into insolvency. Though many of these individuals across the board were vital in helping to bring the U.S. monetary system to the brink of collapse with their bad financial bets, and toxic asset purchases, the industry itself attempted to justify the paying of billions in bonuses to bankers under the guise of the need to retain their talents.

...In 2011, Wachovia bank merged with Wells Fargo, and like all big mergers between corporate entities, choices are made regarding the retention of people, management, and policies each institution followed. Since both banks were intrinsically tied to the government TARP or TAF bailout programs, public perceptions regarding any retention bonuses given in the wake of the taxpayer bailouts were of vital importance.

Thus, a means of creating a retention program for top earning Wells Fargo financial advisers was conceived using a client service program created in 2005. The 4front program was to be used as a backdoor means of retaining financial advisers, and it is here where the fraud and fraudulent actions by Wells Fargo begin. The 4front program, based ‘retention’ bonus payments to financial advisers without calling it a retention bonus. The program, tied to benchmarks created in "Envision" investment/financial plans for households with assets above $250,000, would be the catalyst to provide a bonus structure without giving the perception to the public that direct taxpayer money was going to fund and retain the Wells Fargo Adviser workforce.

...When these ethical or legal standards are violated, it is supposed to be up to the financial enforcement agencies such as the Securities and Exchange Commission (SEC) and/or the Financial Industry Regulatory Authority (FINRA) to step in and investigate, prosecute, and correct illegal activities that threaten the financial well being of investors and the financial system as a whole.

Enter in the former Vice President of Investments and Fundamental Choice Portfolio Manager, George Hartzman. As a Financial Adviser and asset manager at Wachovia, and later a Wells Fargo Adviser after the year end 2008 merger, George had direct insight as both an adviser to clients, and as a participant in the 4front program.

Hartzman contends that Federal laws and statutes were violated as full disclosure to clients in the Envision plans were not being presented accurately, and misleading information was given to clients in hypothetical projections, which ended up on many client monthly financial statements.

“I believe Wells Fargo’s executive management created a backdoor retention program that led thousands of brokers to violate fiduciary duties to the firm’s clients, by incentivizing the omission of investment fees in Envision plans subsequently reported on client statements.

If “the overwhelming majority of Envision Plans [did and] do not include investment costs,” and Plans of Record appear on client statements, hundreds of thousands of Wells Fargo clients are currently being illegally misinformed as to probabilities of achieving their financial goals." - George Hartzman

These actions of transparency, disclosure, and violation of fiduciary duties are outlined in 123

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 123 of 144 Section 206 of the Investment Advisers Act of 1940. This law states: "It shall be unlawful for any investment adviser, …to employ any device, scheme, or artifice to defraud any client or prospective client; to engage in any transaction, practice, or course of business which operates as a fraud or deceit upon any client or prospective client; or... to engage in any act, practice, or course of business which is fraudulent, deceptive, or manipulative."

How these deceptive practices were enacted can be seen in the following example of Harold Lynn, a hypothetical client with Wells Fargo Advisers which matched the investments of one of George's households he inherited from another adviser.

...Fees, or lack of them in many reports created to obtain the retention bonuses, were excluded by advisers to become eligible for the 4front bonus program by design. False information was/is being provided to Wells Fargo Advisers' clients in order for their financial advisers to qualify 4front bonuses, and to not have them clawed back by the company.

...Hartzman is saying many Wells Fargo Advisers’ clients were given misleading projections when presented with Envision plans being used by financial advisers to qualify and claim bonuses via the 4front program..."

As a consequence, Wells Fargo also appears to be making false claims regarding their Envision plans through an advertisement that states 98% of their clients enrolled in the program 'know where they stand in reaching their financial goals'. Since most of the projections investors were given did not fully disclose fees, this published statement appears to be not only incorrect, but a failure in fiduciary responsibility by Wells Fargo Advisers to many of their advisory clients regarding the potential of their actual investments.

...Judging by way the SEC has ignored warnings, letters, and information given by George Hartzman from his time as a Wells Fargo adviser and vice president regarding other known fraud in the banking system over TARP and the massive taxpayer bailouts, it is unlikely that the government intends to prosecute criminal activity on Wall Street as there are very few actions being taken to stop the ongoing fraud, and to protect the public in our current financial system."

180. On February 21, 2013, President of the Dallas Federal Reserve Bank Richard Fisher stated "The Fed has artificially sustained markets."

181. In the Matter of; George Hartzman, Complainant, v. Wells Fargo Advisors, LLC., Respondent, Case No. 2013-SOX-00045 with the United States Department of Labor, Office of Administrative Law Judges, presided over by Judge Kenneth A. Krantz, Wells Fargo refused to provide the following admission;

"Request for Admission 2;

Please admit or deny whether or not Brian Mixdorf, CFE, CFS found Wachovia and Wells Fargo’s 2008 and 2009 SEC securities filings contained or did not contain the words “term auction facility”, and A; that Wachovia and Wells Fargo’s 2008 and 2009 SEC securities filings’, B; including management’s “Discussion and Analysis”, did or did not contain disclosures of the C; nature, D; amounts, E; total credit lines, F; interest rates, G; collateral 124

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 124 of 144 pledged and H; length of the outstanding loans provided by the Federal Reserve via the Fed’s Term Auction Facility to Wells Fargo."

If Mr. Mixdorf didn't find the words “term auction facility” in Wachovia and Wells Fargo’s 2008 and 2009 SEC securities filings, and didn't act on the information, which initial discovery suggests he didn't, an adverse act against Plaintiff occurred.

Either Mixdorf looked and didn't find the words “term auction facility” and other material aspects of SOX related reporting issues or he did not fully investigate a SOX related ethics complaint that should have been forwarded to The Audit and Examination Committee of the Board of Directors.

Not fully investigating three ethics complaints and not forwarding the case to The Audit and Examination Committee of Wells Fargo's Board of Directors would be adverse acts, which Wells Fargo refused to provide.

"This third party investigator determined that Mr. Hartzman's allegations regarding both "secret" loans and Envision were meritless.

Greg Keating Littler Mendelson Attorney representing Wells Fargo

On March 28, 2014, Respondent stated Wells Fargo produced Mixdorf's entire case file, which doesn't include the answers to Request for Admission 2, which a reasonable person with common sense would conclude an investigation by a Certified Fraud Examiner would look into, considering the information provided by Complainant in three Ethics Line filings.

182. In the Matter of; George Hartzman, Complainant, v. Wells Fargo Advisors, LLC., Respondent, Case No. 2013-SOX-00045 with the United States Department of Labor, Office of Administrative Law Judges, presided over by Judge Kenneth A. Krantz, Wells Fargo refused to provide Regulatory Correspondence.

Request for Production of Documents 11; Regulatory Correspondence

Please provide discoverable documentation and communications from or to the Federal Reserve Board (FRB), the Financial Industry Regulatory Authority (FINRA), the Securities and Exchange Commission (SEC), the North Carolina Department of Insurance, the North Carolina Department of Justice, North Carolina’s Commissioner of Banks, the Federal Trade Commission, North Carolina's Secretary of State, Securities Division, The Financial Accounting Standards Board (FASB), the FBI and/or Department of Justice, the Consumer Financial Protection Bureau (CFPB), and/or the Public Company Accounting Oversight Board (PCAOB) concerning or related to George Hartzman's Wells Fargo whistleblower filings/ethics issues [between November 1, 2011 and December 31, 2013].

Respondent does not possess any responsive documents, because this request is directed and seeks information from third parties and not Respondent, and because request does not seek information relevant to Complainant's claims in this action. 125

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 125 of 144

Nevertheless, Respondent reserves the right to supplement its response to this request.

Gregory C. Keating and Benson Pope Littler Mendelson Then Wells Fargo Council On July 18, 2014

Both the listed regulators and Wells Fargo were in possession of information concerning George Hartzman’s whistleblowing activities, which were protected acts under Sarbanes Oxley, because it looks as though Wells Fargo was allowed/motivated to retaliate by non- action without regulatory consequence, which would be an adverse action and a motive to retaliate.

Wells Fargo refused to provide the discoverable, probative information.

183. Exhibit 1, which accompanied Plaintiff's response to the above;

"The "too big to fail" theory asserts that certain financial institutions are so large and so interconnected that their failure would be disastrous to the economy, and they therefore must be supported by government when they face difficulty.

Proponents of this theory believe that some institutions are so important that they should become recipients of beneficial financial and economic policies from governments or central banks...

Inability to prosecute

The political power of large banks and risks of economic impact from major prosecutions has led to use of the term "too big to jail" regarding the leaders of large financial institutions.

On March 6, 2013, United States Attorney General Eric Holder testified to the Senate Judiciary Committee that the size of large financial institutions has made it difficult for the Justice Department to bring criminal charges when they are suspected of crimes, because such charges can threaten the existence of a bank and therefore their interconnectedness may endanger the national or global economy.

"Some of these institutions have become too large,” Holder told the Committee, “It has an inhibiting impact on our ability to bring resolutions that I think would be more appropriate," contradicting earlier written testimony from a deputy assistant attorney general who defended the Justice Department’s "vigorous enforcement against wrongdoing." Holder has financial ties to at least one law firm benefiting from de facto immunity to prosecution, and prosecution rates against crimes by large financial institutions are at 20-year lows.

Four days later, Federal Reserve Bank of Dallas President Richard W. Fisher and Vice- President Harvey Rosenblum co-authored a Wall Street Journal op-ed about the failure of the Dodd–Frank Wall Street Reform and Consumer Protection Act to provide for adequate regulation of large financial institutions...

In a January 29, 2013 letter to Holder, Senators Sherrod Brown and Charles Grassley had criticized this Justice Department policy citing "important questions about the Justice 126

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 126 of 144 Department’s prosecutorial philosophy." After receipt of a DoJ response letter, Brown and Grassley issued a statement saying, "The Justice Department’s response is aggressively evasive. It does not answer our questions. We want to know how and why the Justice Department has determined that certain financial institutions are ‘too big to jail’ and that prosecuting those institutions would damage the financial system."

...As of April 30, 2014, [Kareem] Serageldin remains the “only Wall Street executive prosecuted as a result of the financial crisis” that triggered the Great Recession.

...One of the most vocal opponents in the United States government of the "too big to fail" status of large American financial institutions in recent years has been the newly elected U.S. Senator from Massachusetts, Elizabeth Warren. At her first U.S. Senate Banking Committee hearing on February 14, 2013, Senator Warren pressed several banking regulators to answer when they had last taken a Wall Street bank to trial and stated, "I'm really concerned that 'too big to fail' has become 'too big for trial.'" http://en.wikipedia.org/wiki/Too_big_to_fail.

Exhibit 2

"Why DOJ Deemed Bank Execs Too Big To Jail

If you were a senior bank executive, you might be tempted to at least entertain that thought. You would certainly be very aware that in the past four years, not one banker has gone to jail for anything that led to the great financial meltdown of 2008-2009.

...Not one dollar of the $86.9 billion [in fines] has been paid by any bank executive.

Shareholders took all the hits...

Blame for this mess lies everywhere from federal regulators who cast a blind eye, Wall Street bankers who let greed run wild, and Members of Congress who failed to provide oversight.

Senator Tom Coburn

The Senate Permanent Subcommittee of Investigations referred its report to the Justice Department and Securities Exchange Committee for investigation.

No prosecutions resulted.

Why? Why has no one been held responsible? There are many reasons, including the complexity of the cases and the lack of criminal referrals from the regulatory agencies. But perhaps the key reason is that those most responsible for indicting and prosecuting Wall Street executives seem to believe that, just as there are banks that are too big to fail, there are people who are too big to jail.

In a speech he gave last fall, the retiring head of the Criminal Division in the Department of Justice, Lanny Breuer, explained that position: “To be clear, the decision of whether to indict a corporation, defer prosecution, or decline altogether is not one that I, or anyone in the Criminal Division, take lightly. We are frequently on the receiving end of presentations from defense counsel, CEOs and economists who argue that the collateral consequences of 127

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 127 of 144 an indictment would be devastating for their client. In my conference room, over the years, I have heard sober predictions that a company or bank might fail if we indict, that innocent employees could lose their jobs, that entire industries may be affected, and even that global markets will feel the effects.

“Sometimes–though, let me stress, not always–these presentations are compelling. In reaching every charging decision, we must take into account the effect of an indictment on innocent employees and shareholders, just as we must take into account the nature of the crimes committed and the pervasiveness of the misconduct. ...In large multi-national companies, the jobs of tens of thousands of employees can be at stake. And, in some cases, the health of an industry or the markets is a real factor. Those are the kinds of considerations in white collar crime cases that literally keep me up at night, and which must play a role in responsible enforcement.”

...the argument seems to be that, if the president of a major bank were to be indicted for criminal behavior, his prosecution would endanger the bank itself and the jobs of all of its employees.

...Nothing I have seen in the past four years leads me to believe that Wall Street as a whole learned much from the events of 2008-2009. The government’s bailouts that helped the big banks survive have been pretty much forgotten. The multimillion-dollar bonuses are back with a vengeance, and with them incentives to cut corners and, for some, to circumvent the law.

Ted Kaufman United States Senator, 2009 to 2010 http://www.forbes.com/sites/tedkaufman/2013/07/29/why-doj-deemed-bank-execs-too-big- to-jail/

Exhibit 3

"Too Big to Jail?

We are supposed to be a country of laws. The laws should apply to Wall Street as well as everybody else. So I was stunned when our country's top law enforcement official recently suggested it might be difficult to prosecute financial institutions that commit crimes because it may destabilize the financial system of our country and the world.

...The attorney general was talking about some of the same financial institutions that received billions, and in some cases trillions, of dollars in taxpayer bailouts after their greed, recklessness and illegal behavior plunged the country into a terrible recession...

In addition, the Federal Reserve provided over $16 trillion in total financial assistance to these same institutions during the financial crisis (which only became public after an amendment I inserted into the Dodd-Frank Wall Street Reform and Consumer Protection Act requiring the Fed to disclose this information).

The attorney general's view seems to be that if you are just a regular person and you commit a crime, you go to jail. But if you are the head of a Wall Street company, your power is so 128

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 128 of 144 great that a prosecution could have destabilizing consequences with national or even worldwide implications.

In other words, we have a situation now where Wall Street banks are not only too big to fail, they are too big to jail. That view is unacceptable.

...no institution in America should be above the law..."

US Senator Bernie Sanders http://www.huffingtonpost.com/rep-bernie-sanders/too-big-to-jail_b_2973641.html

Exhibit 4

"SEC is ‘weak’ on enforcement — says one of its commissioners"

The Securities and Exchange Commission has received its share of criticism for not properly policing markets. But lost amid headlines Thursday was a damning indictment from inside the agency.

[Securities and Exchange Commissioner] Luis Aguilar wasn’t willing to go along with a settlement against Kevin Kyser, the former chief financial officer of Affiliated Computer Services.

Aguilar pointed out that... Kyser himself knew what ACS was doing, was responsible for false and misleading public filings, highlighted the misleading revenue growth in earnings releases and analyst calls, failed to ensure ACS adequately disclosed the significance of these calls, signed false certifications and received an inflated bonus.

But Kyser, a CPA, wasn’t charged with fraud, Aguilar lamented.

"Beyond this particular matter, I am concerned that the Commission is entering into a practice of accepting settlements without appropriately charging fraud and imposing Rule 102(e) suspensions against accountants in financial reporting and disclosure cases. I am also concerned that this reflects a lack of conviction to charge what the facts warrant and to bring appropriate remedies.

I am concerned that this case is emblematic of a broader trend at the Commission where fraud charges—particularly non-scienter fraud charges—are warranted, but instead are downgraded to books and records and internal control charges. This practice often results in individuals who willingly engaged in fraudulent misconduct retaining their ability to appear and practice before the Commission.

I fear that cases in the future will continue to be weak.” http://blogs.marketwatch.com/capitolreport/2014/08/29/sec-is-weak-on-enforcement-says- one-of-its-commissioners/

184. "The most recent contribution to the broadening canvas of dysfunction and incompetence surrounding the SEC is a whistleblower complaint filed by 56-year-old Kathleen Furey, a senior lawyer who worked in the New York Regional Office (NYRO), the agency outpost with direct jurisdiction over Wall Street.

129

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 129 of 144 "Furey and the other 20-odd lawyers who worked in her unit at the NYRO were actually barred by a superior from bringing cases under two of the four main securities laws governing Wall Street, the Investment Advisors Act of 1940 and the Investment Company Act of 1940.

According to Furey, her group at the SEC's New York office, from a period stretching for over half a decade through December, 2008, did not as a matter of policy pursue cases against investment managers like Bernie Madoff. Furey says she was told flatly by her boss, Assistant Regional Director George Stepaniuk, that "We do not do IM cases."

...the Investment Advisers Act of 1940 and the Investment Company Act of 1940 ...are the agency's main tools for prosecuting fraud and malfeasance involving people who manage other people's money – mutual funds, hedge funds, investment managers. Somebody like Bernie Madoff, who took billions from investors and simply stole the money instead of investing, would largely be regulated under the latter two acts.

...in 2007, Furey started work on a case that involved Value Line, a high-profile family of mutual funds that was being accused of charging tens of millions of dollars in bogus commissions...

When she tried to take that next step in the Value Line case, Furey says she was denied. This is when she says Stepaniuk filled her in on his "We don't do IM cases" policy. Upset, and convinced that the Assistant Director of the New York office did not have the authority to unilaterally non-enforce two major portions of the SEC's regulatory mandate, Furey appealed to Stepaniuk's superior in the NYRO.

...this official, instead of helping her and paving the way for the investigation to proceed, gave Furey two options. He said she could either recant her statement about being told not to pursue "IM cases," or she could go to the SEC Inspector General.

...Furey in her internal arguments over this case specifically warned that the agency needed to begin enforcing section 206 of the Investment Advisers Act, which barred money managers from employing "any device, scheme, or artifice to defraud any client or prospective client."

During the period from January 1, 2002, through January 20, 2009, Stepaniuk's group did not file a single case under the Investment Advisors Act (IAA) or Investment Company Act (ICA).

During this time frame, Stepaniuk reportedly approached the SEC's Commission 60 times with requests to file cases or to open formal investigations, which, again, is necessary to file subpoenas. Out of those 60 cases, only one, the Value Line investigation opened on April 18, 2008, was an Investment Management case.

In a not-so-amazing coincidence, April 18, 2008 happened to be the same day that the SEC's Inspector General released a report that in part addressed the office's apparent mishandling of that same Value Line case. In other words, the SEC seemed not to move on Value Line until it became a public issue.

130

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 130 of 144 Noted author William Cohan described Furey's post-whistleblowing struggles within the SEC in great detail in a Bloomberg piece. As Cohan explains, Furey went through all the usual nonsense after coming forward and complaining about the failure to bring "IM cases": She was shunned by superiors, kept away from sensitive work and taken off the promotion track.

While a lot of this will seem like a meaningless intramural squabble to outside readers, it points to a larger pattern within the agency. For years, people who come forward and try to press the SEC to pursue important cases have often been treated very poorly, if not with outright hostility.

This has been true of people outside the SEC, like Harry Markopolos or Leyla Wydler, who came forward with information about the Stanford Ponzi scheme, only to be ignored by the SEC. Both the Madoff and Stanford cases, which incidentally were both "IM cases," snowballed into far bigger disasters than was necessary because the agency identically blew off those two whistleblowers.

The agency also has a poor record with whistleblowers within the SEC, like onetime investigator Gary Aguirre, who famously won a $755,000 wrongful termination settlement against the SEC after he was fired for trying to press an insider trading case against future Morgan Stanley chief John Mack.

Aguirre, ironically, now represents Furey, and it sometimes feels like we're re-living the same stories over and over again with this agency. The same kinds of blindly political creatures keep getting promoted to the top jobs, while hardworking line investigators who are just trying to do the work keep running into the same kinds of ludicrous intra-office difficulties. They have to get a clue eventually – don't they?"

Matt Taibbi, May 31, 2013

185. Systemic non enforcement;

"Sen. Elizabeth Warren (D., Mass.) asked regulators why they hadn't held individual bankers accountable for actions that led to the financial crisis...

...Fed Gov. Daniel Tarullo, the regulatory point man at the central bank, [suggested] the Fed could ban individuals at large banks from working again in the industry even if the bank reached a legal settlement with the government over misdeeds. Mr. Tarullo said during a Senate Banking Committee hearing Tuesday the Fed was “conducting investigations” to that effect, but didn’t elaborate...

“You are supposed to refer cases to the Justice Department when you think individuals should be prosecuted,” Sen. Elizabeth Warren (D., Mass.) told Mr. Tarullo and other regulators Tuesday, adding that hundreds of individuals were prosecuted after the savings and loan crisis in the 1980s. “Without criminal prosecutions, the message for every Wall Street banker is loud and clear. If you break the law, you are not going to jail but you might end up with a much bigger paycheck.”

...Tarullo was joined by Martin Gruenberg, chairman of the Federal Deposit Insurance Corporation; Tom Curry, the Comptroller of the Currency; Richard Cordray, director of the 131

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 131 of 144 Consumer Financial Protection Bureau; Mary Jo White, chair of the Securities and Exchange Commission; and Tim Massad, chairman of the Commodity Futures Trading Commission...

...Warren allowed that the regulators themselves can’t prosecute — that would be up to the Justice Department. But regulators can provide referrals.

Daniel Tarullo, ...when pressed, indicated that the Fed didn’t specifically refer anyone.

..."How many senior executives did the Fed refer to DOJ for prosecution, Warren asked Federal Reserve Governor Daniel Tarullo.

“I don’t know,” he answered.

“You don’t know any? No one has been referred?”

“We shared all the information DOJ needed,” he said.

“So have you referred anyone?” Warren asked.

...the six agencies couldn't come up with a single referral between them. Tarullo only lamely managed to say that the Fed had "shared" information with the Justice Department...

...Mr. Tarullo, who was interrupted several times by Ms. Warren ...had a testy exchange after the hearing, with Ms. Warren waving her arms as she appeared to express displeasure with Mr. Tarullo’s on-the-record answers."

During the savings and loan crisis in the 1980s and 1990s, Warren said, the FBI opened 5,500 investigations based on referrals from banking regulators. Prosecutors brought 1,000 criminal cases and won more than 800 convictions...

...The problem, [Warren] continued, is that the civil settlements, which are paid for by the shareholders, don’t provide the kind of deterrence that “seeing the guy in the office next to you led out in handcuffs” might. JPMorgan CEO Jamie Dimon got an $8.5 million raise after settling with the government, she said.

“Without criminal prosecution, the message to every Wall Street banker is loud and clear. If you break the law, you’re not going to jail, but you might end up with a much bigger paycheck,” Warren said.

Sen. Richard Shelby (R., Ala.), ...said he agreed with Ms. Warren's outrage over the lack of jail time for bankers...

...Shelby ...laid the blame on the U.S. Justice Department...

No one in the financial sector or elsewhere should be "able to buy their way out from culpability when it's so strong it defies rationality..." Mr. Shelby said. “Ultimately, it seems like the Justice Department seems bent on money rather than justice and that’s a mistake.”

..."The law on this is clear," Warren said, citing federal judge Jed Rakoff, "that no corporation can break the law unless an individual within those corporations has broken the law."

And yet, Warren continued, "not a single senior executive of these banks has been criminally prosecuted."

132

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 132 of 144 Worse, she said, citing the case of JPMorgan chief executive Jamie Dimon, they are likelier to get a raise for negotiating such a "great settlement" when the bank breaks the law.

..."If there is no justice," [Alabama Republican Richard Shelby] said, "then there is something wrong with the Justice Department."

...“If you steal $100 on Main Street, you’re probably going to jail. If you steal a billion bucks on Wall Street, you darn well better go to jail, too,” said Warren.

...Warren asked the regulators gathered if any had referred any specific executives to the Justice Department for criminal prosecution. No regulator volunteered that they had...

A Justice Department representative didn't respond to a request for comment."

Multiple Sources

186. As attested to by SEC Commissioner Luis A. Aguilar on August 28, 2014;

"Dissenting Statement In the Matter of Lynn R. Blodgett and Kevin R. Kyser, CPA, Respondents" by SEC Commissioner Luis A. Aguilar on August 28, 2014

...I am obligated to speak out when it appears that the agency falters.

Accordingly, I respectfully dissent from the Commission’s Order accepting the settlement offer of Kevin R. Kyser, a Certified Public Accountant and former Chief Financial Officer (“CFO”) of Affiliated Computer Services, Inc. (“ACS” or “Company”).

Given the egregious conduct that Mr. Kyser engaged in at ACS, the Commission’s settlement, which lacks fraud charges ... is a wrist slap at best.

...let’s discuss how Mr. Kyser, in his critical role as CFO, facilitated ACS’s misconduct. As described in the Commission’s own Order, Mr. Kyser:

...Was responsible for the content of ACS’s false and misleading public filings with the Commission, earnings releases, and analyst conference calls... “During all relevant periods, Respondents Blodgett and Kyser were, respectively, ACS’s chief executive officer and chief financial officer. As such, they were responsible for the content of ACS’s filings with the Commission, as well as ACS’s earnings releases and analyst conference calls.”

“ACS falsely reported its internal revenue growth, which Blodgett and Kyser highlighted in earnings releases and analyst conference calls during the period.”

Failed to ensure that ACS adequately disclosed and described the significance of these transactions in ACS’s public filings and analyst conference calls...

Signed false certifications in connection with the Company’s periodic filings; “Blodgett and Kyser certified each of ACS’s fiscal year 2009 Forms 10-Q and 10-K.”

...I am concerned that the Commission is entering into a practice of accepting settlements without appropriately charging fraud... I am also concerned that this reflects a lack of conviction to charge what the facts warrant and to bring appropriate remedies.

The statistics on financial reporting and disclosure cases ... reflect a troubling trend. In fiscal year 2010, the Commission brought 117 financial reporting and disclosure cases against issuers and individuals... In 2011, the number of financial reporting and disclosure 133

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 133 of 144 cases against issuers and individuals brought by the Commission fell to 86... In 2012, again the number of similar cases brought by the Commission fell, this time to 76... In 2013, the Commission brought only 68 similar cases... These declining numbers reveal a departure from the Commission’s efforts to keep bad apples out of the securities industry, and this puts investors and the integrity of the Commission’s processes at grave risk.

...defendants strenuously object to scienter-based and non-scienter-based fraud charges... That is to be expected.

What is not to be expected is when defendants engage in fraud and the Commission affirmatively accepts a weak settlement with lesser charges [GH; Or no investigation or prosecution at all]. This leaves the investing public significantly at risk, as bad actors are not appropriately charged or sanctioned and are permitted to continue to operate in the securities industry.

This is completely unacceptable. I am concerned that this case is emblematic of a broader trend at the Commission where fraud charges...are warranted, but instead are downgraded to books and records and internal control charges.

I fear that cases in the future will continue to be weak. ...I am concerned that Commission Orders may, at times, be purposely vague and/or incomplete, and written in a way so as to lead the public to conclude that no fraud had occurred. When this happens, the public is denied a full accounting and appreciation of the egregious nature of a defendant’s misconduct. In addition, this practice muzzles my voice by not allowing any statement by me (including this dissent) to include a fulsome description of facts that support the view that the Commission should have brought fraud charges. ...Facts and information discovered by the investigative staff in the course of an investigation that are not described in a Commission Order or other public document are deemed confidential and, therefore, SEC representatives are prohibited from revealing to the public such non-public information that are not made a matter of the public record...

This adversely impacts my ability as a Commissioner to provide the American public honest and transparent information—including a description of facts discovered by the staff during its investigation. In the end, these behind-the-curtain decisions can make fraudulent behavior appear to be an honest mistake.

For these reasons, I dissent."

Luis A. Aguilar SEC Commissioner August 28, 2014

186(b) Affiliated Computer Services misreported revenue in SEC filings from the quarter ended Sept. 30, 2008, through June 30, 2009, misinformation illegally certified under Sarbanes Oxley that Messrs. Blodgett and Kyser "highlighted in earnings releases and analysts conference calls during the period", as did executives at Wachovia and Wells Fargo via the illegal omission of material Federal Reserve loans and credit lines.

134

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 134 of 144 On 2009-05-06, President & CEO Lynn Blodgett, sold 33,000 of Affiliated Computer Services shares for $1,554,564 while illegally misleading shareholders, the SEC and the public and appears to have gotten away with Sarbanes Oxley violations and insider trading without prosecution.

In his dissent, Commissioner Aguilar documented the same non-enforcement of Sarbanes- Oxley reporting statutes cited by Plaintiff, and spelled out how our nation's regulatory enforcement infrastructure prevented fraud related material information from being disseminated to the public, and how the government didn't enforce the law.

[GH; If Wells Fargo made arrangements or was informed/assured of non-action by regulatory authorities in response to Plaintiff's whistleblowing activities, an adverse event would have taken place against Plaintiff under the color of the law as a consequence.

Per Commissioner Aguilar's dissent among multiples of other instances of non-action by those tasked with law enforcement, Plaintiff correctly concluded in the first quarter of 2012 that he had been 'hung out to dry' by Wells Fargo in collusion with regulators etc..., which, after his anonymity was violated and sought action by his management chain of command, was placed in jeopardy.

Plaintiff believes the governmental consent bestowed upon Wells Fargo among others allowing them to get away with breaking the law makes these proceedings fall under special circumstances exceptions, considering the extent to which Wells Fargo's and tens of other 'To Connected to Jail' corporate executives have acted outside the law without reprimand.

Courts have applied an exception to general rules where "the obvious result of following the rule would be a plain miscarriage of justice or would be inconsistent with substantial justice." Seniority Research Group v. Chrysler Motor Corp.

I believe this exception applies in this case as the regulatory issues highlighted have been proven to be systemic by officials in the SEC and the Justice Department etc... tasked with securities law enforcement;]

"There are exceptions, as where the obvious result of following the rule would be a plain miscarriage of justice or would be inconsistent with substantial justice. Kelley v. Crunk, 713 F.2d 426 (8th Cir.1983). In Stafford I, ...this Court found that substantial justice required a review of whether ... procedure had been exhausted...

...if an impartial hearing is not available at one level, it can be obtained at the next. " http://openjurist.org/976/f2d/1185

187. The pursuit of Plaintiff's allegations were made in good faith, and "the obvious result of following the rule would be a plain miscarriage of justice or would be inconsistent with substantial justice", because Respondent, the SEC and the Justice Department etc... didn't follow their own rules in multiples of different instances.

188. Plaintiff contends all procedures had been exhausted by non-enforcement and judicial inaction, and communications between regulatory authorities and Respondent's in-house 135

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 135 of 144 attorneys concerning Hartzman's whistleblowing activities should be discoverable as relevant as they may provide evidence of adverse acts against Plaintiff, under the concept of substantial justice, and justified by Fiduciary and Crime Fraud Exceptions, as addressed in the Matter of; George Hartzman, Complainant, v. Wells Fargo Advisors, LLC., Respondent, Case No. 2013-SOX-00045.

189. from: George Hartzman to: "McFadden, JoAnna (USANCM)" date: Thu, Oct 30, 2014 at 1:14 PM subject: Hartzman v Wells Fargo [per a prior telephone call with JoAnna McFadden]

Regulatory Contacts;

[email protected] [email protected] [email protected] [email protected] [email protected] [email protected] investigator at the state, not employed there anymore [email protected] [email protected] Daniel J. Stefek, Director, FINRA District 7 - Atlanta . . from: George Hartzman to: [email protected] date: Sun, Nov 2, 2014 at 10:05 AM subject: Re: Hartzman v Wells Fargo

The previous NC Treasurer objected to the Wachovia, Wells merger.

Janet Cowell didn't.

Roy Cooper didn't.

The attorney representing Wells Fargo in my case in Federal District Court gave to Cooper's campaign, amongst multiples of other Robinson Bradshaw employees.

Attorneys from Robinson Bradshaw gave to Janet Cowell's political campaigns.

Robinson Bradshaw represents the NC Treasurer as external council.

The NC Treasurer was a fiduciary over about 3.2 million shares of Wachovia and didn't do anything concerning securities fraud and insider trading by Wells Fargo executives, when the Term Auction Security etc... loans became common knowledge after Dodd Frank mandated disclosure by the Federal Reserve...

The NC Treasurer is a fiduciary over what remains of Wells Fargo stock.

Attorneys from Robinson Bradshaw are representing both Wells Fargo against me and the NC Treasurer at the same time.

The NC Treasurer owns large quantities of Wells' stock and didn't and isn't taking action on securities fraud and insider trading, which would be in the best interests of North Carolina employees and taxpayers, while employing Wells Fargo's council simultaneously.

136

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 136 of 144 from: George Hartzman to: [email protected] date: Sun, Nov 2, 2014 at 11:27 AM subject: Re: Hartzman v Wells Fargo

Robinson Bradshaw's Robert Fuller, who is representing Wells Fargo against me, represented Wachovia Wells Fargo in the merger case at the NC Business Court, while his firm represented the NC Treasurer's office. http://www.rbh.com/robert-w-fuller/?op=experience http://hartzman.blogspot.com/2013/10/hartzman-v-wells-fargo-advisors-llc.html . . from: George Hartzman to: [email protected] date: Thu, Nov 6, 2014 at 11:38 AM subject: Context http://www.rollingstone.com/politics/news/the-9-billion-witness-20141106?page=6 . . from: George Hartzman to: [email protected] date: Fri, Nov 7, 2014 at 8:26 AM subject: I would like to meet.

What would be good early next week? http://www.nakedcapitalism.com/2014/11/taibbi-ex-jp-morgan-lawyer-smoking-gun- mortgage-fraud-stymied-holder-cover.html . . from: George Hartzman to: [email protected] date: Fri, Oct 31, 2014 at 10:07 AM subject: Re: Hartzman v Wells Fargo

The response to my complaint is due on November 14, 2014.

If your office chooses to not engage, please provide an explanation in writing before then.

137

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 137 of 144 from: McFadden, JoAnna (USANCM) to: George Hartzman date: Fri, Nov 7, 2014 at 10:31 AM subject: Re: I would like to meet.

Mr. Hartzman,

I do not believe that meeting is necessary at this point in time. I will reach out to you if I need more information beyond what you have already provided.

Many thanks, JoAnna . . from: George Hartzman to: "McFadden, JoAnna (USANCM)" date: Fri, Nov 7, 2014 at 10:47 AM subject: Re: I would like to meet.

Do you intend to intervene in my case?

This is a case the DOJ is supposed to prosecute.

I would love to know why I am doing this instead of the government, but I think it's apparent.

...I guess this is par for course.

I got about the same answer from the rest.

You and your superiors have to protect your careers at my, and thousands of Wachovia shareholders and Wells Fargo Advisor clients expense, just like the rest at the SEC and FINRA etc...

When the dots go under the lines in all those Envision plans, and those hundreds of thousands of clients figure out they were lied to, at least they'll have these emails to see, to show the government knew and didn't lift a finger. . . from: George Hartzman to: "McFadden, JoAnna (USANCM)" , [email protected], [email protected], [email protected], [email protected], [email protected], [email protected], [email protected], [email protected], [email protected], [email protected], [email protected], [email protected], [email protected], [email protected], "Luginbill, Jennifer" , "[email protected]" , "[email protected]" , [email protected], [email protected], [email protected] date: Wed, Nov 19, 2014 at 3:53 PM subject: Re: I would like to meet.

138

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 138 of 144 On 11/19/2014, I informed Wells Fargo's Council that I intend to add John Stumpf and Robert Steel as defendants.

After receiving Wells Fargo's reply, I connected the legal dots.

A conspiracy is an agreement between two or more persons to commit a wrongful act.

Such an agreement may be implied by the conduct of the parties.

The Department of Justice has done nothing.

The SEC as well.

Not even a phone interview.

Not a meeting.

I believe my family is in danger at this point.

139

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 139 of 144 CLAIMS

Pursuant to Rule 10(c) of the Federal Rules of Civil Procedure, Plaintiff adopts by reference the averments and allegations of paragraphs 1-189, inclusive;

191. 18 U.S. Code § 1514A - Civil action to protect against retaliation in fraud cases http://www.law.cornell.edu/uscode/text/18/1514A

192. 29 U.S. Code § 1104 - Fiduciary duties http://www.law.cornell.edu/uscode/text/29/1104

193. 18 U.S. Code § 1344 - Bank fraud http://www.law.cornell.edu/uscode/text/18/1344

194. 17 CFR 240.13b2-2 - Representations and conduct in connection with the preparation of required reports and documents http://www.law.cornell.edu/cfr/text/17/240.13b2-2

195. 17 CFR 240.14a-9 - False or misleading statements. http://www.law.cornell.edu/cfr/text/17/240.14a-9

196. 8 U.S. Code § 1343 - Fraud by wire, radio, or television http://www.law.cornell.edu/uscode/text/18/1343

197. 17 CFR 240.10b-5 - Employment of manipulative and deceptive devices. http://www.law.cornell.edu/cfr/text/17/240.10b-5

198. 15 U.S. Code § 77q - Fraudulent interstate transactions http://www.law.cornell.edu/uscode/text/15/77q

199. 17 CFR 240.12b-20 - Additional information. http://www.law.cornell.edu/cfr/text/17/240.12b-20

200. 18 U.S. Code § 1348 - Securities and commodities fraud http://www.law.cornell.edu/uscode/text/18/1348

201. 18 U.S. Code § 1346 - Definition of “scheme or artifice to defraud” http://www.law.cornell.edu/uscode/text/18/1346

202. 18 U.S. Code § 1962 - Prohibited activities http://www.law.cornell.edu/uscode/text/18/1962 140

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 140 of 144

203. 42 U.S. Code § 1983 - Civil action for deprivation of rights http://www.law.cornell.edu/uscode/text/42/1983

204. 15 U.S. Code § 80a–35 - Breach of fiduciary duty http://www.law.cornell.edu/uscode/text/15/80a-35

205. 15 U.S. Code § 80a–47 - Liability of controlling persons; preventing compliance http://www.law.cornell.edu/uscode/text/15/80a-47

206. 15 U.S. Code § 80b–6 - Prohibited transactions by investment advisers http://www.law.cornell.edu/uscode/text/15/80b-6

207. 17 CFR 240.10b-3 - Employment of manipulative and deceptive devices by brokers or dealers. http://www.law.cornell.edu/cfr/text/17/240.10b-3

208. 15 U.S. Code § 7245 - Rules of professional responsibility for attorneys http://www.law.cornell.edu/uscode/text/15/7245

209. 18 U.S. Code § 1621 - Perjury http://www.law.cornell.edu/uscode/text/18/1621

210. 29 U.S. Code § 1103 (c)(1) - Establishment of trust http://www.law.cornell.edu/uscode/text/29/1103#c

211. 15 U.S. Code § 7243 - Forfeiture of certain bonuses and profits http://www.law.cornell.edu/uscode/text/15/7243

212. 15 U.S. Code § 78t - Liability of controlling persons and persons who aid and abet violations http://www.law.cornell.edu/uscode/text/15/78t

213. Plaintiff repeats and realleges each and every allegation contained in the foregoing paragraphs as if fully set forth herein.

141

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 141 of 144 REQUESTED RELIEF

Declare, determine, and find that the Defendants have committed the violations of the federal securities laws alleged herein.

Issue an Order directing the Defendants to disgorge all ill-gotten gains, including prejudgment interest, resulting from the acts or courses of conduct alleged in this Complaint.

As Defendant has refused to provide information concerning the history of Plaintiff's book of business, Plaintiff is currently unable to detail specific business related damages.

Require defendants to pay damages sustained by Plaintiff by reason of the acts and transactions alleged herein.

Issue a judgment, as necessary and appropriate, to ensure that Defendants Steel and Stumpf do not obtain repayment or indemnification from any person or entity, including Wells Fargo, Goldman Sachs, Perrella Weinberg or any government entity, which would offset or otherwise reduce in any way their personal obligation to reimburse the amounts required to be reimbursed under the Sarbanes-Oxley Act of 2002 and by this Court.

Retain jurisdiction of this action in accordance with the principles of equity and the Federal Rules of Civil Procedure in order to implement and carry out the terms of all orders and decrees that may be entered, or to entertain any suitable application or motion for additional relief within the jurisdiction of this Court.

Grant such other and further relief as this Court may determine to be just and necessary.

Grant permanent injunctive relief directing Defendants to reinstate Plaintiff in his prior position, back pay, with interest, emotional distress damages, punitive damages and compensation for special damages, including litigation costs, expert witness fees and reasonable attorney fees.

Permanently restrain and enjoin each defendant from violating Securities Act Section 17(a), Exchange Act Sections 10(b) and 13(b)(5) and Exchange Act Rules 10b-5 and 13b2-1, and from aiding and abetting violations of Exchange Act Sections 13(a), 13(b)(2)(A) and 13(b)(2)(B) and Exchange Act Rules 12b-20, 13a-1, 13a-13; (b) permanently restrain and enjoin defendants Stumpf and Steel from violating Exchange Act Rule 13b2-2; (c) permanently restrain and enjoin defendants Stumpf and Steel from violating Exchange Act Rule 13a-14; (d) permanently restrain and enjoin defendants Stumpf and Steel from aiding and abetting violations of Exchange Act Section 10(b) and Exchange Act Rule 10b-5; (e) order each defendant to disgorge, with prejudgment interest, all ill-gotten gains, compensation, and benefits (whether realized, unrealized or received) by virtue of the conduct alleged herein; (f) pursuant to Securities Act Section 20(d) and Exchange Act Section 21(d)(3), order each defendant to pay civil penalties; (g) pursuant to Securities Act Section 20(e) and Exchange Act Section 21(d)(2), prohibit defendants Stumpf and Steel from acting as an officer or director of any issuer that has a 142

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 142 of 144 class of securities registered pursuant to Exchange Act Section 12 or that is required to file reports pursuant to Exchange Act Section 15(d); (h) grant any equitable relief that may be appropriate or necessary for the benefit of plaintiff pursuant to Exchange Act Section 21(d)(5); and (i) grant such other relief as the Court may deem just and appropriate. (j) grant Plaintiff a whistleblower's share of;

15 U.S. Code § 78u–6 - Securities whistleblower incentives and protection, and any settlement/action/fine from any other statutes culminating from publicly disseminated information within this filing. http://www.law.cornell.edu/uscode/text/15/78u-6

143

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 143 of 144 Signed Wednesday, December 3, 2014

/s/ George Hartzman George Hartzman 2506 Baytree Drive Greensboro, North Carolina 27455 336-420-4916 [email protected]

CERTIFICATE OF SERVICE

I hereby certify that on Wednesday, December 3, 2014, I served the foregoing upon the following;

Attorneys for Defendant Wells Fargo & Company or one or more of its direct or indirect subsidiaries

Robert W. Fuller North Carolina Bar No. 10887 [email protected]

Pearlynn G. Houck N.C. Bar No. 36364

Robinson Bradshaw & Hinson, P.A. 101 North Tryon Street, Suite 1900 Charlotte, North Carolina 28246 Telephone; 704-377-2563 Facsimile; 704-378-4000

/s/ George Hartzman George Hartzman 2506 Baytree Drive Greensboro, North Carolina 27455 336-420-4916 [email protected]

144

Case 1:14-cv-00808-WO-LPA Document 24-1 Filed 12/03/14 Page 144 of 144